In most U.S. states, businesses have the right to refuse cash payments. While there is no federal law in place that prohibits businesses from refusing cash payments, there are several states that do require businesses in their jurisdictions to accept cash from consumers. Otherwise, generally speaking, businesses can generate their own payment policies.
Business Policies
A business can go cashless if it operates in a state and city that has not legally prohibited it from refusing cash payments. There are several practical, operational, and security reasons for switching to a cashless business, including:
- Accommodating cash-only or otherwise underbanked or unbanked customers
- Eliminating time-consuming manual cash handling procedures
- Reducing the likelihood of robbery and embezzlement
- Lowering operational costs
- Reducing customer waiting times and improving the customer experience
Legal Setbacks
Several U.S. states and cities, such as Massachusetts, New Jersey, Washington, NYC, and Miami, have passed laws mandating businesses to accept cash payments from their customers.
However, there are a few notable exceptions to some of these laws. For instance, in some jurisdictions, if a business can show that keeping cash on its premises makes it more vulnerable/a target for theft, especially in high-crime areas, then it could achieve an exempt status.
Also, while physical currency is considered “legal tender,” businesses are not legally obligated to accept it during a purchase. Instead, they must not refuse physical cash when a customer settles a debt.
How can businesses comply with state mandates that require them to accept cash while still offering a cashless payment experience?
Cashless businesses in a jurisdiction that mandates cash payments can still accommodate cash-only customers and remain legally compliant. After all, cash is a lifeline for unbanked consumers who shouldn’t be barred from making a purchase just because they need to use cash.
Introducing a Reverse ATM™ onto the premises is a highly effective way to accommodate cash-only customers in a cashless environment. They’ll simply insert their cash and receive a pre-paid debit card in the same amount they can later use anywhere major pre-paid debit cards are accepted.
Businesses can also install dual payment systems, consisting of traditional cash registers and credit and debit card terminals for fast, contactless, and mobile payment alternatives.
Transforming your business into a cashless establishment benefits everyone, from your operations, staff, and customers! Accommodate your cash-only customers and ensure legal compliance with Ready Credit’s cashless solutions.