According to a Fortune report, published March 7, 2019, Philadelphia is poised to become the first major U.S. city to ban and penalize stores and restaurants that do not accept cash as a means of payment.
From Cash to Cashless to Cash
A cashless society is often viewed as the inevitable future for mankind. Various countries, especially Scandinavian ones, are already preparing themselves to transition from a cash-heavy society to a completely cashless one.
Sweden is famous for spearheading the cashless movement as the use of cash as a means of payment is “almost extinct” in the country. Cash has been replaced by more robust and advanced means of payments like cryptocurrencies, mobile wallets, and for some adrenaline seeking folks, implant chips.
However, the latest move by Philadelphia aims to make it mandatory for stores and retailers to accept cash. The city’s council, on February 15, 2019, passed a bill with 12 to 4 vote banning cashless brick-and-mortar stores.
Cashless stores in the city have time until July 1, 2019, to start accepting cash as a means of payment or pay fines as high as $2,000.
One of the reasons for such legislation, as explained by Councilman Bill Greenlee, is to ensure an equal playing field for people with no access to digital modes of payments. Greenlee argued that a city with a 26 percent poverty rate could not afford to become a cashless city.
His claim found footing in a recent survey held in the city which found that about six percent of Philadelphia’s population does not have access to banking services. It’s worth highlighting that although cash and coins are legal tender in the U.S., per the Federal Reserve’s website, no law mandates business to accept them.
Impact on Businesses
The report by Forbes notes the legislation’s potential impact on new business ventures that accept payments only through app or card.
E-commerce behemoth Amazon will rethink their decision to open brick-and-mortar stores in Philadelphia, while Sweetgreen, a famous salad chain in the U.S., will also have a lot to worry about as their business model currently does not accept cash.
For all the benefits that a cashless society might bring, it also has its own set of cons which might not be viable in real life at all. Speaking of other states, Massachusetts already has a law in place that requires all stores to accept cash and credit for payment purposes.