So what is the deal with cashless businesses? I’ve noticed more and more of them popping up in cities like New York and Philadelphia. In my experience, they are mostly casual, take-out food joints — fancy salad joints, down-home-American-cuisine meal assembly lines, overpriced fancy burrito cafes, and even some third-wave coffee shops.
These businesses make the claim that they are cashless for positive reasons. They say it makes the flow of service go faster, that it is cleaner (no dirty dollars and coins passing from hand to hand - who knows where they have been …), and that it is safer (no stacks of cash means no burglars or armed robbers, right?).
So this all sounds great! Right? Well, it depends on who you ask.
For people with credit cards and bank accounts, in theory there is no problem with frequenting cashless businesses. All they have to do is swipe their card — or pay with an app connected to the business they want to buy from after giving the app access to their credit card number. And everyone has credit cards, right?
Wrong. According to a study done by the Federal Research Bank of Boston, as of 2015 only about 75% of Americans had a charge card, a credit card, or both. That means that 25% of the US population (about 82million people) can’t buy things at cashless businesses.
Think about that: 82 million people can’t enjoy the fancy salad or the third wave coffee at these new cashless businesses simply because the business will not accept their hard earned money in the form of physical currency. And having a credit or charge card is not evenly distributed throughout the population. Sure, maybe there are some rich people who don’t have credit cards, but really the majority of people without access to credit cards are poor, working-class Americans. African-Americans, Hispanics, and immigrants are more likely to not have a credit card than White Americans (remember, saying 25% of Americans don’t have credit cards means on average. That means everyone is lumped together to make that statistic. In reality, the percent of Whites who don’t have credit cards is much lower than the percent of Blacks and Hispanics who don’t have access to credit.)
So by refusing to accept cash, businesses are systematically shaping their clientele. By not accepting cash, businesses are not so subtly telling poor people, and especially people of color, “you can’t shop or eat here.” Which can sound a lot like “we don’t want you to shop or eat here.”
These issues are why politicians in a lot of major cities have recently started crafting legislation to ban cashless businesses. In Philadelphia, for example, the mayor has just signed new legislation that makes it illegal for business to refuse cash payment, with a few exceptions. It seems that New Jersey, New York, Chicago, Washington, and San Francisco are also looking into using legislative means to make refusing cash payment illegal.
So the next time you go into a store that doesn’t accept cash, take a minute to look around. See who is and isn’t present in that space. Notice who walks by, looks in the window, and then doesn’t come in. For the moment, cashless businesses offer a space to observe social stratification in action. Let’s hope, for the sake of equity, that moment doesn’t last very much longer.