According to consumers, cash is no longer king. Approximately three in 10 Americans said they do not buy anything with cash in a typical week, according to the Pew Research Center. Meanwhile, the number of people who say they only use cash for their purchases dropped from 24% in 2015 to 18%. With millennials leading the charge, the most common way for people to buy something is with a digital app, like Venmo and Apple Pay.
At a time when society continues pay for more goods and services with digital wallets and credit cards, New Jersey lawmakers made a move recently to protect its cash-paying consumers.
With the overwhelming support of the state’s Assembly and Senate, New Jersey passed a bill preventing businesses from banning consumers from using cash for purchases. If Gov. Phil Murphy signs proposed law, A591, into law, New Jersey will be the second state in the nation to protect cash-paying customers who make purchases at bricks-and-mortar stores.
Massachusetts has a similar law, and New York City is considering a proposal to prevent retailers and restaurants from banning the use of cash. Individuals states can only prohibit businesses from banning the use of cash for purchases. However, there is no federal law that requires a business to accept cash.
Exemptions to the Law
The law does not impact mail, telephone, and online sales. Car-rental companies also are exempt.
Reasons for the Law
Government officials have said that banning the use of cash discriminates those who do not have access to credit cards, such as low-income individuals. Also, legislators believe that consumers should have many ways to pay, including cash. Many lawmakers also criticized credit card brand, Visa, for its marketing campaign, Visa Cashless Challenge. In 2018, Visa awarded $10,000 each to 50 food-service businesses that best explained how using cashless purchase systems could improve their operations.
Penalties for Violating the Law
If signed into law, violators would be subject to fines of $2,500 for the first offense and $5,000 for the second. Further violations would be considered unlawful practices under New Jersey’s Consumer Fraud Act.
Why Businesses Choose to Go Cashless
Most wonder why a business would want to limit the type of payments they offer to their customers. But, some establishments moved away from accepting cash because these transactions can become major losses. Some places made this move because it gave their employees were time to focus on serving customers, it removed the potential of giving away too much change or thefts from employees, and it kept companies safe from robberies. Others have done it because they want to stay on-trend with consumers moves toward more cashless payments.
In Conclusion
Though New Jersey is trying to take a step to protect cash-paying consumers, forcing retailers to accept cash should not upend any business’ livelihood. Now, everyone will need to sit back and see if the bill is signed into law.
If you are business that wants to accept debit and credit cards in addition to cash, then consider contacting merchant service provider, eMerchantBroker.com (EMB). It offers payment solutions for all types of businesses, including those considered high risk. The online application process is simple and quick. Most eligible applicants get approved in as little as 48 hours. Apply now and move forward with credit card processing for your business.