House Panel Asks Whether Legislation Can Keep Cash as King

January 31, 2020by Jim Saksa, CQ-Roll Call (TNS)
House Panel Asks Whether Legislation Can Keep Cash as King

WASHINGTON — At some uncertain point in the future, printing cash may be a waste of money. As Americans increasingly rely on credit cards, online transfers, mobile apps and cryptocurrencies to complete transactions, a House panel debated Thursday the promise and potential pitfalls of a cashless society.

In recent years, some stores have decided they’d rather not ask “paper or plastic?” to customers at checkout. Instead, they’ve gone cash free, accepting only smartphone apps such as Apple Pay, mobile payments like Venmo, or debit and credit cards.

That’s led to a legislative response, with left-leaning cities and states banning cashless stores and a bill from New Jersey Democrat Donald M. Payne Jr. that would do the same across the country.

The House Financial Services Committee’s task force on financial technology heard witnesses tout how new payment technologies would save consumers time and money, while others warned that that innovation alone would not solve the systemic problems keeping the American dream out of reach for many.

“Too often, we see these companies claiming to eliminate banking deserts or empowering communities when in fact they are perpetuating segregation in our banking system,” said Deyanira Del Rio, co-executive director of the New Economy Project. “This is not to malign innovation or technology. They’re not intrinsically bad or good, and that’s the point.”

Cash may have once been king, but in 2018 it lost its crown as top payment method. Debit cards were used that year in 28% of U.S. transactions to cash’s 26 percent, according to the Federal Reserve. Credit cards and electronic payments have also seen their shares grow in recent years.

That’s led some businesses to stop accepting cash. While merchants have to pay transaction fees on card and mobile payments, cash isn’t free, either. Physical money means regular trips to the bank to make deposits, making change, reconciling cashier tills and risk of theft. As electronic payment transaction times have dropped, high-volume retail businesses can move customer lines quickly relying just on electronic payments.

But not everyone has adopted the new technologies, almost all of which rely on the user maintaining an active bank account. According to a Federal Deposit Insurance Corporation survey in 2017, 6.5% of the nation is unbanked. Lower income and minority populations are more likely to rely on cash than to use cards or electronic payments.

“To me, it’s about choice,” said Payne. “What happens to that segment of the country that does not come along with this move towards other currencies? What happens to the grandmother that just can’t learn all of this rigmarole on the phone?”

New Jersey instituted a cashless ban last year, as did Philadelphia and San Francisco. New York City passed its own ban last week. Massachusetts, which has had a ban on the books since 1978, is considering a repeal.

But whether to take cash should be a choice for companies, too, Republicans on the task force contended. Some companies have decided that it’s worth losing some cash-only customers to save the headaches of dealing with physical money. It would be folly, Republicans said, to stifle innovation and adoption of new technologies with overly broad regulations.

“By acting before we really understand what we’re dealing with, we have a tendency to drive innovation — and, more importantly, the entrepreneurs responsible for it — out,” said Tom Emmer, R-Minn., the ranking member of the task force.

———

©2020 CQ-Roll Call, Inc., All Rights Reserved

Visit CQ Roll Call at www.rollcall.com

Distributed by Tribune Content Agency, LLC.

A+
a-
  • cryptocurrencies
  • MOney
  • U.S. House of Representatives
  • In The News

    Health

    Voting

    In The News

    March 28, 2024
    by Dan McCue
    Silicon Valley-Based Firm Launches ‘Radar as a Service’

    BELMONT, Calif. — At first the idea sounds about as un-Silicon Valley as one can get. After all, the basic... Read More

    BELMONT, Calif. — At first the idea sounds about as un-Silicon Valley as one can get. After all, the basic concept underlying radar was proven in 1886, when a German physicist named Heinrich Hertz showed that radio waves could be reflected from solid objects. And the... Read More

    March 28, 2024
    by Dan McCue
    Elections Task Force Prosecutes 2020 ‘Vigilantes,’ Seeks More Civic Dialogue

    PHOENIX, Ariz. — A 46-year-old Ohio man has been sentenced to 30 months in prison for sending death threats to... Read More

    PHOENIX, Ariz. — A 46-year-old Ohio man has been sentenced to 30 months in prison for sending death threats to an Arizona election official. The sentencing of Joshua Russell, of Bucyrus, Ohio, came after he pleaded guilty to one count of making a threatening interstate communication.... Read More

    March 28, 2024
    by Tom Ramstack
    Disney World Settles with Florida After Its Opposition to 'Don’t Say Gay' Law

    ORLANDO — The company that runs Walt Disney World reached a settlement Wednesday with appointees of Florida Gov. Ron DeSantis... Read More

    ORLANDO — The company that runs Walt Disney World reached a settlement Wednesday with appointees of Florida Gov. Ron DeSantis who were exerting controversial regulatory control over the huge tourism complex. The settlement resolves some of the disputes that arose after Disney officials publicly denounced the... Read More

    US Changes How It Categorizes People by Race and Ethnicity. It's the First Revision in 27 Years

    ORLANDO, Fla. (AP) — For the first time in 27 years, the U.S. government is changing how it categorizes people by race and... Read More

    ORLANDO, Fla. (AP) — For the first time in 27 years, the U.S. government is changing how it categorizes people by race and ethnicity, an effort that federal officials believe will more accurately count residents who identify as Hispanic and of Middle Eastern and North African heritage. The revisions... Read More

    March 28, 2024
    by Dan McCue
    Vice President Harris Rolls Out First Government-Wide Policy to Mitigate AI Risks

    WASHINGTON — Vice President Kamala Harris on Wednesday rolled out the Biden administration’s first government-wide policy intended to mitigate the... Read More

    WASHINGTON — Vice President Kamala Harris on Wednesday rolled out the Biden administration’s first government-wide policy intended to mitigate the risks associated with artificial intelligence while still enabling its use to advance the public interest. The new policy, which is being issued through the White House... Read More

    March 27, 2024
    by TWN Staff
    Rep. Cleaver New Co-Chair of House Renewable Energy and Energy Efficiency Caucus

    WASHINGTON — Rep. Emanuel Cleaver II, D-Mo., is the new Democratic co-chair of the House Renewable Energy and Energy Efficiency... Read More

    WASHINGTON — Rep. Emanuel Cleaver II, D-Mo., is the new Democratic co-chair of the House Renewable Energy and Energy Efficiency Caucus. He was invited to serve as co-chair by Sens. Jack Reed, D-R.I., and Mike Crapo, R-Idaho, the co-chairs of the Senate Renewable Energy and Energy... Read More

    News From The Well
    scroll top