A Bit of Nuance: Should Businesses Stop Accepting Cash During a Pandemic?

Updated: Mar 17

The onset of the coronavirus has posed a unique challenge to businesses, as they attempt to weather the pandemic while keeping their employees and customers happy and safe. One of the issues that businesses have found themselves deciding on is whether or not to accept cash. Many businesses, especially in larger cities have stopped accepting cash, at least for the duration of this pandemic. While cashless businesses may have lower overhead, lower theft risk, and possibly reduced coronavirus transmission risk, and they escape problems like dealing with bank closures and coin shortages, they risk alienating those who depend on cash, like homeless people, undocumented immigrants, and teenagers without bank accounts.


Businesses Should Go Cashless Luke Wang

Businesses Shouldn’t Go Cashless Lucas Ribeiro

On Transmissibility: Cash has a greater risk of spreading COVID-19 Although paper money does not usually transmit the coronavirus, some people have poor hygiene practices such as sneezing into their hands or touching unsanitary surfaces, then immediately touching their paper money. The virus can last up to three days on paper money. Although the virus can also last a few days on plastic, there is less of a chance for virus transmission through a credit card, since usually, only the owner of the credit card touches it. The forms of payment that possess the least risk of transmission are through mobile apps, such as apps like Apple or Samsung Pay, since there is zero contact. Some businesses have already been cashless since before the pandemic. For example, Sweetgreen, a salad chain, stopped accepting cash at some of their stores in 2016 and found that service became 10% faster.

On Transmissibility: Cash usually doesn’t transmit COVID-19 While it has been proven that the virus responsible for COVID-19 is able to survive on paper money, that does not mean that cash can easily spread coronavirus. For cash to spread coronavirus, the virus must make its way from the banknote to a victim’s nose or mouth which rarely happens given that many people associate cash as being dirty, and use hand sanitizer and/or wash our hands immediately after handling cash. Overall, coronavirus transmission through cash has had a very minor effect on the total number of cases. In fact, there have been no recorded cases of coronavirus that were proven to be transmitted through cash. Businesses and governments hoping to further reduce coronavirus transmission can also invest in technologies like UV sterilization for cash, which kills viruses that find their way onto banknotes. Either way, given the minimal likelihood of coronavirus transmission through cash, this should not be a justification for banning cash payments.

On Necessity: Cash dependency is a huge problem with society Groups that depend on cash include the homeless, undocumented immigrants, and the poor, as well as teenagers whose parents don’t trust them with credit cards. However, it isn’t really necessary for teenagers to use cash, since replacements exist. As for everyone else, continuing their use of cash would only be covering up society’s problems. Teenagers can use a debit card with a spending limit or a stored value card instead of cash. Instead of giving out a weekly allowance in cash, parents can instead increase the balance on the cards. This also has the advantage of making it harder to pay for illegal substances without getting caught by their parents. The homeless and many that live paycheck-to-paycheck are unable to use credit cards because they can’t afford the fees of a bank account or keep a minimum balance. A logical solution would be to increase the amount of welfare they receive or decrease the fees associated with having a bank account. This would also help the economy greatly, since the money they spend would become someone else’s income. Many undocumented immigrants don’t use credit cards because they are afraid of being deported. To solve this problem, the government should make the immigration process less difficult so that fewer immigrants would be undocumented in the first place. Preparing to go cashless will force our society to recognize that there are problems that need to be solved.

On Necessity: Too many depend on cash to allow businesses to stop accepting it completely Many groups, such as undocumented immigrants and the homeless, use cash as their primary form of payment. This is because getting a credit card usually requires a bank account, a utility bill, and a form of identification, which can be inaccessible for some. Many are also uncomfortable with the privacy risks that credit cards bring, as banks are able to track purchase information and sell it to advertisers. Teens, who need parental consent to obtain a credit card, are also generally cash dependent. All of these groups cause 30% of transactions in the U.S. to be done with cash. If a business becomes cashless, it is effectively discriminating against these cash dependent groups. If too many businesses do this, cash-dependent people will be at an inherent disadvantage when it comes to their options when buying things. When cashless businesses first started to appear around 2017, many activists and cities realized these issues and pushed back, with some cities, like Philadelphia and New York, banning cashless businesses entirely. Cash replacements do exist, and most people use them, but to get everyone to use them would be practically impossible. This is because many, particularly those doing informal jobs, are paid in cash and may not have bank accounts. For cashless businesses to be accessible to all, we would need a system where people could easily deposit their cash into accounts, without requiring any complex documentation. The whole process of implementing a system like this and getting everyone to use it would require a lot of extra resources, which our government lacks during a pandemic. It would also continue alienating people who use cash for privacy reasons.

On Difficulties of Using Cash: Cash is a primary target for burglars and is often used to pay for illegal materials, substances, and bribes A high proportion of robberies involve cash. In addition, 12% of robberies targeted banks, gas or service stations, or convenience stores, while 16% targeted commercial houses, which are buildings that house businesses. So if stores were to stop using cash, then they wouldn’t have to deal with as many robberies as before. This means that workers behind the cash register would feel safer and that the company would no longer need to borrow expensive armored trucks to transport cash. Interactions involving illegal materials or corrupt officials often use cash, since cash is very difficult to trace. Even in America, corruption is still a problem. In fact, the FBI named public corruption as its number one criminal priority in 2010. If society was to get rid of cash, those buying illegal substances or bribing public officials would have a much harder time paying without getting caught. This would also disincentivize the sellers from selling illegal materials and substances, since they would have far fewer buyers than before if a government went cashless. Cash also reduces profit margins, since it slows down transactions by requiring cashiers to count out money. So if businesses were to go cashless, they would have more money, which could be used to pay off debts, set up an emergency fund, and increase wages for their employees.

On Difficulties of Using Cash: Coin shortages and bank closures mean the government should encourage businesses to keep accepting cash When a business becomes cashless, it must no longer deal with counting cash, using armored trucks, or dealing with most robberies. Before the pandemic, these reasons were sometimes already enough to sway businesses towards becoming cashless, especially where cash was no longer a common payment. Fortunately, businesses who became cashless were rightfully called out as being exclusive, leading most of them to revert their decisions. With the pandemic, the decision to not accept cash began to be wrongly viewed as reasonable, as people misguidedly believed that handling cash puts them at risk. Additionally, accepting cash has become harder than ever, with severe coin shortages throughout the country making it harder to give change and accelerating closures of bank branches complicating the process of depositing cash. These factors are the driving force behind the shift to cashless, and they mean that for most businesses, it is the more economical decision to reject cash. However, this alienates people and increases inequality, so businesses should be encouraged to accept cash, and more state and local governments around the country should ban cashless businesses, or at least provide incentives to those who accept cash. Businesses that continued accepting cash through the pandemic have been able to find creative workarounds to the issues that cash brings. For example, in response to coin shortages, Kroger has been encouraging people to donate what would have been change to charity and has raised hundreds of thousands of dollars for an organization that donates food, the Zero Hunger Foundation, a practice that has far more benefit than stopping to accept cash.