Source: United States Senator for New Jersey Bob Menendez
WASHINGTON, D.C. – U.S. Senators Bob Menendez (D-N.J.) and Kevin Cramer (R-N.D.) today reintroduced the Payment Choice Act to ensure customers have the freedom to choose how to pay for goods and services. With the increased use of electronic and contactless methods of payment and many businesses refusing cash, consumers without access to financial services face a disproportionate burden. The bipartisan legislation would prohibit retail businesses from refusing to accept cash as a form of payment and charging a higher price for using cash than for other forms of payment.
“While electronic payments are a convenient method for customers to pay for goods or services, completely refusing cash as a form of payment denies people, frequently in underserved populations, from having equal access to participate in our economy,” said Sen. Menendez. “Our bipartisan, commonsense legislation would guarantee everyone who carries legal tender printed and backed by the U.S. Treasury, and especially those who are unbanked or underbanked, can continue to fully participate in the economy.”
“Prohibiting cash payments is an act of discrimination against the millions of Americans who do not have bank accounts or prefer cash. It also forces customers to exclusively use a less secure form of payment. The Payment Choice Act protects people’s right to participate in the economy using their preferred form of payment. If businesses unilaterally stop accepting cash, why do we print money? Is it really legal tender for all debts as it says?,” said Sen. Cramer.
While the majority of American households have access to all of some financial services, 5.4 percent of U.S. households are unbanked, meaning they don’t have a checking or savings account. 16 percent of Americans are underbanked, which means they rely on a variety of financial services, such as money orders, to make transactions. Unbanked and underbanked consumers are more likely to have lower incomes, less education, or be a member of a racial or ethnic minority group.
Despite a decline in cash payments during the past few years, they represent 19 percent of all payments in the U.S. economy according to a recent study.
In 2019, the State of New Jersey enacted S. 2785, a state law that makes it illegal for businesses to refuse cash as a payment option. A similar law has existed in Massachusetts since 1978.
The Senate version of the Payment Choice Act is a companion bill to H.R. 4395 introduced by Representative Donald Payne. H.R.4395 passed the House on June 15, 2022 as an amendment to H.R. 2543, the Federal Reserve Racial and Economic Recovery Act. The Consumer Choice in Payment Coalition (CCPC), a broad-based group of consumer advocates, businesses, and nonprofit organizations supports both bills.
“We believe it is critical to ensure that cash remains a universally available payment option for consumers throughout the nation,” said Linda Sherry, of Consumer Action national advocacy group, a member of the Coalition. “Noncash transactions generate vast amounts of data, recording the time, date, location, amount, and subject of each consumer’s purchase, which are available to digital marketers and advertisers who are engaged in developing and refining increasingly sophisticated techniques to identify and target potential customers.”
“We greatly appreciate Senators Menendez and Cramer work to protect cash as a vital ongoing payment option for consumers that will help us maintain the strength of our economy,” said Bruce W. Renard, Executive Director of the National ATM Council, and a Co-Chair of the Coalition. “Enactment of the Payment Choice Act will help keep the U.S. Dollar strong and stable here at home, and preserve its status abroad as the world’s leading fiat currency. Maintaining universal acceptance of cash provides all Americans with a low-cost, user-friendly, private, and reliable payment option of immense benefit to us all, individually and collectively.”
The text of the bill can be downloaded HERE.
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