Earlier today, the Los Angeles City Council moved forward a policy to prohibit cashless retail businesses. This is to promote economic inclusivity, especially for those without digital payment access or bank accounts. The unanimous decision called for studying cashless policies in other cities to inform local initiatives. The motion was introduced by Councilwoman Heather Hutt on August 15, with the aim of alleviating difficulties faced by residents trying to participate in the city's economic structures, as reported by Patch.
Central to the motion is the understanding, that many residents of Los Angeles, primarily those with low income, do not have access to credit or banking facilities. There are also individuals reluctant to engage in formal banking. In turn, cashless payment methods can exclude many from being able to make purchases. This makes it crucial to provide payment alternatives to ensure economic accessibility and inclusivity.
As a 2017 report from the Federal Deposit Insurance Corporation (FDIC) noted, 17% of all African-American households and 14% of Latino households in the United States had no bank account. Additionally, groups such as the elderly, juveniles, and vulnerable populations like homeless and immigrant communities could be affected by businesses refusing cash payments. This information can be found in a report by FOX 11 Los Angeles
The United States has seen other municipalities putting regulations in place for cashless retail transactions. Philadelphia was the first large city to ban cashless stores in 2019, this led other cities to consider similar regulations. These rules intend to prevent marginalization of those with limited or no access to non-traditional forms of payment.
