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But it's not just the unbanked who need or want cash
Insider’sreport payment options. Data from the Federal Reserve's 2016
Diary of Consumer Payment Choice showed cash to be the
on payments most frequently used payment instrument, accounting for
31 percent of all consumer transactions in the United States.

"Cash is held and used by a large majority of consumers,"
the Fed wrote. Unsurprisingly, most consumer cash
payments are for small-dollar purchases: nearly 60 percent
of in-person transactions under $10 were made with cash
in 2016, the Fed said.
Of cash and cash More recently, a study of cash payments conducted by

the research firm Edelman Intelligence for ATM deployer
discounting Cartronics found cash to be Americans' second most
preferred payment method, behind debit cards. Twenty-
eight percent of consumers told Edelman they most
By Patti Murphy preferred cash; 37 percent said debit cards. Credit cards
were the preferred method for 20 percent of Americans
ProScribes Inc. surveyed, digital payments ranked fourth with 13 percent,
and just 2 percent said they prefer to pay with checks.
once had a teacher who was fond of saying "cash has What's more, 73 percent of consumers told Edelman they
no enemies." It's true. Cash is an equal opportunity regularly pay with cash despite having other payment
payment instrument: everyone can access and use it options available to them.
I regardless of age, credit standing or access to bank
accounts. So it's curious that some business owners are I get it. I'm one of those consumers. I'm a big impulse
turning their backs on cash-paying customers. And these purchaser. Holding myself to spending only what I can
businesses coexist with a growing number of others who pay for with cash on hand is one of the ways I keep my
offer discounts to customers who pay by cash instead of spendthrift inclinations in check.
using credit and debit cards.
Don't discount cash discounting
The anti-cash movement seems to be most pronounced in
urban areas. And the backlash has been fierce. In February Which brings me to my next point: cash discounting is not a
2018, activists marched on an Amazon bookstore in mid- fad. I believe it's a trend that will continue to gain merchant
town Manhattan during the evening rush hour to protest converts. And I suspect efforts by the card brands to curb
the store's policy of only accepting electronic payments. the practice will fall flat.

Lawmakers in several jurisdictions, including New York It's not just because consumers want the option of paying
City, have introduced bills to ban retailers from refusing with cash. Merchants want choices, too, like options for
cash payments. The rationale is that despite the proliferation managing costs.
of electronic ways to pay, a sizeable number of Americans
can't readily access these new payment options because The cost of card acceptance has gone from being a relatively
they're unbanked. unknown topic reserved for industry publications and
obscure federal lawsuits, to being a topic that just about
Cash is perennially popular everybody knows something about.
The Federal Deposit Insurance Corp. reported that 8.4 As I've opined in the past, retailers and their trade group
million or 6.5 percent of U.S. households were unbanked contributed hugely to this change when they coined the
in 2017. Those households comprised 14.1 million adults phrase "swipe fees" to describe interchange. And they've
and 6.4 million children, the FDIC said. A 2015 report by done a bang-up job arguing that lower interchange
the Urban Institute painted an even bleaker picture among translates to lower consumer prices. (This despite the fact
New Yorkers, revealing that 11.7 percent of households in that several studies indicate most retailers failed to lower
the Big Apple didn't have bank accounts. prices following the Durbin Amendment to the Dodd-
Frank Act, which slashed allowable interchange on debit
While nonbank-issued prepaid cards are an option for the card payments.)
unbanked, these can be out of reach for many, as the fees
assessed for loading cash and performing other routines I was reminded of this in February when various national
combine to often rival monthly bank account maintenance publications, led by the Wall Street Journal, began reporting
fees. that Visa and Mastercard were preparing to raise some

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