Every bill from United States of America has the phrase “this note is legal, tender for all debts, public and private.“ I always presumed that meant any debt that I owed could be settled with dollars. The phrase seems to mean that this money is useable and acceptable anywhere in the country. Years ago, I found myself in a foreign country and saw signs in stores that expressed a preference for dollars over that country's currency. So, anyone could choose to accept dollars.
There are various trends evolving in the world of money, which I find challenging and interesting. In the realm of business management, potential accidents or injuries, and the calculations of average weekly wage, there are implications here. Money and the exchange of value is changing.
Months ago, I ordered at a local restaurant and noted a warning on the menu. Each page had a footer that essentially said using a credit card would result in the imposition of a 4% “convenience fee.” In essence, the cost of processing a credit payment was being passed on to the customer. That was a unique experience, but I have encountered it repeatedly since. These businesses, it seems, prefer the old greenback.
There was once a legislative attempt to prevent such "surcharges," but it was deemed "an unconstitutional regulation of speech." The spending of money may in some ways be constitutionally protected. Some will undoubtedly struggle with how a constraint on some fee is speech restriction, but there it is.
Some would argue that this is no different than passing along any cost. A restaurant might impose a restroom fee (I’ve eaten at northern restaurants where coins were required, although that’s more common outside the United States). Any element of a dining or shopping experience might be separately monetized, or the cost of such components might be aggregated into the cost of the good or service. In either event, the cost is borne, sometimes more directly than others.
Having adjusted to this paradigm, I was troubled by a recent conversation with a next-gen about currency. As we discussed purchasing, I learned the next-gen literally does not carry cash. That is "never" carries cash. While I know there are many App and card alternatives, I assumed everyone kept some cash on hand. Wrong.
I inquired why and was told that many businesses this individual frequents simply do not accept cash. I was told that these businesses post notes on their entrances to advise customers that no cash is present or accepted. That got me thinking about the note on each bill that says it is "legal tender." How can a business refuse dollars?
The Federal Reserve says that there is no requirement that anyone accept American money.
"Private businesses are free to develop their own policies on whether to accept cash unless there is a state law that says otherwise."
In that vein, it is therefore apparently permissible for a business to similarly post a sign that says "Only krone, rupee, and won accepted." The business is free to insist on its preferred payment currency. Or, perhaps to say "anyone paying in rupees will be charged a 4% convenience fee?"
So knowing it is permissible to insist on cash, the next question is why? Channel 12 Pheonix reports that businesses say that going cashless makes them "more efficient and safe." The efficiency comes in not having to make change. I have met people who struggled to count out change even when a computer told them how much. See Rudimentary or Superfluous (July 2023). That makes some sense. The efficiency may impact the workforce; less effort needed, fewer employees needed?
The business' effort to share the cost of service is also perhaps intertwined. The "tip jar" at the counter is increasingly ubiquitous as is the constant inquiry about tipping in each app or card transaction. See Tipping (February 2023). is the cashless paradigm more prone to encouraging or guilting tipping and thus lowering business labor costs?
But "safe?" How are cards or Applications any more safe? Less person-to-person contact as regards germs? No, it turns out the safety has to do with miscreants that rob the business, demand the cash, and threaten customers and staff with violence. The Phoenix story cited above includes an explanation of robbery and losing cash. The elimination of robbery and its potential for violence is an admirable goal, if that sort of thing occurs (it does not make the news in some areas, and the frequency is hard to judge).
Though I have encountered the "we charge extra if you use your card," I have not encountered the "we don't take cash." Does that have to do with regional preferences, trendiness, or what? According to the Tampa Bay Times, "A growing number of businesses of all sizes are going cashless." There are various Florida locations and venues that are identified in that discussion.
Regardless of safety and convenience of transactions, there have been many cases litigated over the years regarding average weekly wages and the questions of tips. The receipt of cash by workers can be challenging for businesses in this regard. States have reacted with various statutory limitations. Florida imposed the "earned and reported for federal income tax purposes" definition in 440.02. Thus "unreported" tips are distinct from those known to the employer. Nonetheless, some AWW litigation remains prevalent.
That statute was designed to both encourage employees to actively participate in funding the government and to diminish the volume of post-injury disputes about what wages were actually earned. There was some perception that tips were not being actively or accurately recorded in the day-to-day, but were being claimed in the post-injury benefit calculation process. Perhaps, on the whole, those disputes are diminishing.
With payment through apps and cards, perhaps this is also impacted. There is, in that, less opportunity for unreported or underreported earnings. There are bookkeeping advantages, recordkeeping simplifications, and thus efficiency benefits for both workers and businesses. In a cashless society, perhaps tips become more readily reported and taxed? Some critics also complain that their spending habits might as readily be tracked, and evaluated, and their privacy diminished.
The Phoenix story also noted an effort to require businesses to accept American money for goods and services. The sponsor of that legislation says that such policies have disparate impacts on some societal elements. He notes "minority populations are less likely to be enrolled with banks and (therefore to) rely on cash." Thus, refusing American money is seen by some as discriminatory. There are perhaps some who might instead say "racist." The courts long ago concluded that "disparate impact" on a group is a grounds for allegations of discrimination. See Griggs v. Duke Power Co., 401 U.S. 424 (1971).
Florida has had similar discussions, though many businesses and some transactions were specifically excluded in the most recent discussion. House Bill (HB) 35 was debated in 2024, along with a companion - Senate Bill (SB) 106. That effort did not reach the chamber floors this year. A similar bill in 2022 was not successful. Nonetheless, debates and discussions may continue.
Accessibility for all is an admirable goal. Should businesses be free to decline cash (their freedom of speech perhaps, as in the setting of fees)? Or, is there as strong a counterbalancing right of access, that is diminished discrimination, that might prevail in the interest of the "non-banking" population? That is yet another example of balancing rights. See Rights Collide (February 2016) and Free Speech and Due Process (June 2022).
Is there a broader solution?
Halfway around the world, India is adapting to a "Unified Payments Interface" or UPI that is purportedly answering the "cashless" call with a process that is accessible to almost anyone. The system is involved in India's central bank and is free to use. The system is processing an amazing 14 billion annual transactions according to the British Broadcasting Corporation (BBC). Its use increased 50% last year alone. The news characterizes it as "wildly popular."
But, it is also rife with fraud threats that are challenging the public's learning curve. There are the same concerns of privacy, which are perhaps more feared than in the bank setting. This is a government system that could track consumption and preferences, a step beyond a bank being able to do so and to share with a government. Whether such fears are valid or not, the fact that fear and reluctance can exist has to be considered in any discussion of reaching some degree of uniform participation.
Thus, there are various trends. There are those who love cash and those who do not. There are issues of accessibility, simplicity, efficiency, safety, privacy, and more. There are advocates for paradigms and the debates will likely continue. In the end, I will continue to keep a bit of cash with me. Call me old school, but somehow I am more confident in my dollars than in the phone-tech and plastic that may one day nonetheless replace it.