Payne introduced similar bills in 2019 and 2021. The legislation, which also won bipartisan support in the past, passed the House on two occasions. The revived House bill now also has two more co-sponsors.

Despite businesses leaning away from cash during the COVID-19 pandemic, cash still accounts for nearly 20% of all payments in the U.S., according to a 2021 report by the U.S. Federal Reserve Bank of San Francisco.

Payne worries that a cashless society will leave out unbanked and underbanked households in the U.S. The Federal Deposit Insurance Corporation (FDIC) has estimated that 5.9 million U.S. households, or about 4.5% of households, were unbanked in 2021, meaning they didn’t have a bank or credit union checking or savings account.

Payne also cited concerns about the privacy of digital payments, particularly with respect to data collection, fraud and identity theft. He said he believes cash is also necessary because of the possibility of natural disasters that could knock out a power grid and leave people without the means to make or accept digital payments.

The text of the Senate bill lays out requirements for businesses to accept bills up to $20 and to prohibit charges for cash payments. It also provides for no-fee options to convert cash to a payment card and proposes penalties of up to $1,500 for each violation.

The congressional legislative proposal joins a growing body state and municipal laws protecting cash payments in Colorado, New Jersey, New York City, Philadelphia, San Francisco and Washington, D.C.

By James Pothen on June 20, 2023
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