City bans cashless businesses
New York City NY Jan 26 2020
City lawmakers will require that all businesses accept cash payments, a response to a growing list of restaurants going cashless to expedite checkouts.
Proponents of a bill banning so-called cashless establishments—expected to be voted into law Thursday—say the arrangement excludes the more than 360,000 households that do not have bank accounts, according to a 2015 city-funded Urban Institute report.
“This will ensure the digital economy is inclusive of all of us, including the most vulnerable New Yorkers,” Councilman Ritchie Torres, the bill’s sponsor, said during a news conference before the council meeting.
Torres and the rest of the bill’s proponents point to the Urban Institute report, which found roughly 12% of city residents have no bank account. Those households often rely instead on payday loans and check-cashing facilities, according to Councilman Rafael Espinal Jr., chair of the council’s committee on consumer affairs and business licensing.
“Across the city, there are large populations disconnected from banking institutions,” Espinal, a co-sponsor of the legislation, said before his committee voted in favor of the bill.
Businesses who refuse to accept physical currency could face fines between $1,000 and $1,500 for each offense.
New York is set to join Philadelphia and San Francisco on the list of cities to ban cashless businesses. Massachusetts and New Jersey have statewide prohibitions on businesses refusing hard currency.
Going cashless has been a popular option for fast-casual restaurant brands, which prefer to cycle through customers quickly during busy lunch hours. Dos Toros and Dig Inn are both cashless. Popular salad purveyor Sweetgreen was cashless but reversed course in the fall following two years of criticism.
In a hearing February on the bill, Dos Toros co-CEO Leo Kremer said going cashless allowed the brand “to serve our guests more smoothly, operate more efficiently, and (it) significantly enhances our ability to improve our team training and morale and by extension to create a more compelling guest experience.”
Only a small percentage of city restaurants have gone cashless, according to Andrew Rigie, executive director of the NYC Hospitality Alliance, a restaurant lobbying group.
“Regardless of the cashless ban, our elected leaders need to support policies that get more New Yorkers ‘banked,’ because technology is advancing and mobile payments are the way of the future,” Rigie said via email.
The bill would allow businesses to house machines that convert cash into pre-paid cards, an option popular at laundries. The businesses would not be allowed to impose fees on the transactions.
