Credit cards, according to CNBC, now make up over 82% of all in-store retail transactions in the United States. Card-not-present payments such as Apple Pay are on the rise.  Digital currencies such as bitcoin may be the wave of the future.  Which brings up the question: do stores still need to accept cash?

The downside of cash is that it requires more staff to handle. Making change necessitates having a variety of bills and coins on hand at all time – the prevalence of ATMs as a source of cash means lots of $20 bills that need to be broken. There have been concerns about it being unsanitary, especially at the height of the pandemic. Cash can also be stolen, which leads to security concerns. 

While banning cash as an option might simplify life for retailers, laws are being proposed in some states to prevent this from happening.  The main fear is that this policy discriminates again low-income shoppers who may not have a credit or debit card. If these shoppers cannot pay cash, they are unable to buy anything.

The high incidence of credit card use does have their drawbacks. As retailers, we are well aware that bank fees have become a significant cost of business for us all.  Legislators have pointed out that using credit cards also encourages overspending.  The collective credit card debt in the U.S. surpassed $1 trillion this year. 

The time has probably not come for most of us to become cashless. But since the trend is going in that direction, we need to negotiate with credit card processors in order to keep their fees in line. USA Today quotes the Nilson Report finding that merchants paid $126.4 billion in credit card processing fees in 2022.  There is legislation proposed to limit credit card fees, and it deserves our support.

Happy Retailing,

Carol “Orange” Schroeder