Tuesday, February 26, 2019
"The issue is far broader than the poor and unbanked segment of the economy pointed to by these legislative measures," said David Tente, executive director of ATMIA USA. "Cashless retail severely limits consumer payment choice and eliminates the favored payment method for 26 percent of the population, according to Federal Reserve numbers."
George Sarantopoulos, NAC Board Chair and CEO at Access One Solutions Inc., expressed concern that a truly cashless society would put the final nail in the consumer privacy coffin. "I think the number one threat of going completely cashless is that big business then will really know everything you're doing," he said.
The FDIC National Survey of Unbanked and Underbanked Households was published in October 2018 by the Federal Deposit Insurance Corp. and U.S. Census Bureau. "To assess the inclusiveness of the banking system, and in partial response to a statutory mandate, the FDIC has conducted the survey biennially since 2009," researchers wrote. "The most recent survey was administered in June 2017 in partnership with the U.S. Census Bureau, collecting responses from more than 35,000 households."
Despite declining underbanked populations, the survey found millions of U.S. consumers lack access to basic banking services. Unbanked and underbanked segments rely on cash and alternative financial services, researchers noted. Survey data included the following key findings:
Additional findings from ATMIA indicate that 45 percent of consumers prefer to use cash at local retail establishments. Tente pointed out that a cashless environment would permanently remove the cash payment option, which is frequently the only option in times of crisis, when electronic products and services are not available.
ATMIA CEO Mike Lee questioned the wisdom of decreasing freedom of choice for citizens in a free market democracy. He also pointed out that every U.S. banknote clearly states, "This note is legal tender for all debts, public and private," which implies that refusing a cash payment should not be permitted except in the most extreme circumstances.
ATMIA will continue to support legislative efforts to protect cash payment options at the POS, Lee stated, adding that the association's support of financial inclusion will include an upcoming position paper titled Cash is Legal Tender.
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