CMS Analytics’ ‘Securing Access’ series highlights initiatives around the world which are helping maintain and improve both the public’s and businesses access to cash.
Philadelphia is the first major US city to ban cashless stores and restaurants in favor of protecting the unbanked members of society. The Wall Street Journal has stated that from July 1st, most stores will have to accept cash as a form of payment and will not be able to place a surcharge on anyone using this method of payment. Any business who does not conform to this law could be fined up to $2,000. However, some businesses will be exempt from this law, such as parking lots, garages, hotels, wholesale stores and car rental companies.
With the rise of cards and mobile payment methods, the use of cash for payments has decreased in recent years. However, it still plays a vital role for those without bank accounts and credit cards, and vulnerable groups, like the elderly, who may not be as comfortable with new technologies. A 2017 report by the Federal Deposit Insurance Corporation estimated that 6.5% of American households were unbanked. Additionally, according to the Federal Reserve, 26% of American’s say that cash is their favorite payment instrument, further emphasizing cash’s relevance and importance to a large group of people.
This measure passed by the Philadelphia City Council is likely to have a rippling effect across the United States. Indeed, the New Jersey Legislature is set to be initiating the same stance, while New York City, Washington and Chicago are exploring similar actions.
Philadelphia has taken a significant step for its residents, and a small step on the global scale, in the protection of access to cash, a trend we hope will continue.
Read the full story here: www.nytimes.com.