I went to a counter-serve restaurant recently, and when the time came to pay for my order, took out my wallet, presented a $20 bill, and was told, “Sorry, we don’t accept cash.” I was flabbergasted. What happened to “legal tender for all debts public and private,” as it says right there on the bill? This has now happened to me at three separate establishments in recent months. The rise of cashless establishments is happening amid continuing hype over the supposed dawn of a “cashless future” and agitation by some very powerful interests that would love to see cash disappear. The credit card companies love it, naturally, and tech industry associations have also pushed for the concept.

Meanwhile, a backlash has prompted several cities and states including San Francisco, Philadelphia, and New Jersey to ban cashless stores (they’ve also been banned in Massachusetts since 1978). One salad chain, Sweetgreen, reversed its decision to go cashless amid criticism, and Amazon, which had reportedly been opposing legislative bans, has since announced that it will accept cash at its automated, cashier-less convenience stores. (As for the “legal tender” statement, that does not actually mandate the acceptance of cash for payment.)

It is great to see this pushback against the supposed cashless future because this is a trend that should very much be nipped in the bud. There are several reasons why cashless stores, and a cashless society more broadly, are a bad idea. Such stores are:

• Bad for privacy. When you pay cash, there is no middleman; you pay, you receive goods or services — end of story. When a middleman becomes part of the transaction, that middleman often gets to learn about the transaction — and under our weak privacy laws, has a lot of leeway to use that information as it sees fit. (Cash transactions of more than $10,000 must be reported to the government, however.) More on privacy and payment systems in a follow-up post.
• Bad for low-income communities. Participation in a cashless society presumes a level of financial stability and enmeshment in bureaucratic financial systems that many people simply do not possess. Opening a bank account requires an ID, which many poor and elderly people lack, as well as other documents such as a utility bill or other proof of address, which the homeless lack, and which generally create bureaucratic barriers to participating in electronic payment networks. Banks also charge fees that can be significant for people living on the economic margins. According to government data from 2017, about one in 15 U.S. households (6.5%) were “unbanked” (had no checking or savings account), while almost one in five (18.7%) were “underbanked” (had a bank account but resorted to using money orders, check cashing, or payday loans). Finally, because merchants usually pass along the cost of credit card fees to all their customers through their prices, the current credit card system effectively serves to transfer money from poor households to high-income households, according to a study by the Federal Reserve.
• Bad for people of color. The burden of lack of access to banking services such as credit cards does not fall equally. While 84% of white people in 2017 were what the Federal Reserve calls “fully banked,” only 52% of Black and 63% of Hispanic people were.
• Bad for the undocumented. Facing a lack of official identity documents, not to mention all the other obstacles mentioned above, undocumented immigrants can have an even harder time accessing banking services.
• Bad for many merchants. Merchants pay roughly 2-3% of every transaction to the credit card companies, which can be a significant “tax,” especially on low-margin businesses. With the credit card sector dominated by an oligopoly of 2-3 companies, there is not enough competition to keep these “swipe fees” low. Big companies have the leverage to negotiate lower fees, but small merchants are out of luck, and the amount that they pay to the credit card companies is often greater than their profit. If cashless stores are allowed to become widespread, that will harm the many merchants who either discourage or flat-out refuse to accept credit cards due to these fees.
• Less resilient. The nationwide outage of electronic cash registers at Target stores several weeks ago left customers unable to make purchases — except those who had cash. That’s a reminder that electronic payments systems can mean centralized points of failure — not just technical failures like Target’s, but also security failures. A cashless society would also leave people more susceptible to economic failure on an individual basis: if a hacker, bureaucratic error, or natural disaster shuts a consumer out of their account, the lack of a cash option would leave them few alternatives.

The issue goes beyond restaurants and retail stores; other services that are built around electronic payments should also offer cash options (or cash-like anonymous stored value cards). Those include ride-share services like Uber and Lyft, bike and scooter share systems, and transit systems. In San Francisco, for example, the city’s bike-share program is providing an option to pay with cash. In DC, where I live, the Metro requires a smart card to use — but riders have the option to either register their card so that they can cancel it if it’s lost or stolen, or buy it with cash and not register it to keep it more private.

Proponents of non-cash payment systems point to one of the biggest downsides of cash: the risk of loss or theft. That security risk is real, and we’re certainly not going to tell anybody they should always use cash, especially for large purchases. That said, the security considerations are not one-sided. The harms that can result from privacy invasions (abuses, profiling, embarrassment, financial losses, etc.) should also be included in the concept of “security,” properly conceived. And payment networks have security risks that cash does not; ask anybody who has experienced identity theft and was forced to wrangle with a nightmare mix of credit card companies, debt collectors, credit scoring agencies, and others.

What to do

So what should you do if you walk into a store and are told: “your cash is no good here”?

• Register your objection. Say to the staff, “I know this isn’t your policy personally, but I think it’s a bad one, and I hope you’ll pass that along to your management. Not accepting cash is bad for privacy, bad for poor people, and bad for the undocumented.” 
• Refuse to provide a credit card. If you haven’t been given very clear advance notice that cash is not accepted, tell them you don’t have a credit card with you and see what they propose. There’s no law that a person has to possess a credit card or furnish one on demand. This may tie up their line, require the calling of a manger, create abandoned food that has already been prepared, and generally create inefficiencies that, if repeated among enough customers, will start to erode the advantages of going cashless for merchants.
• Walk out. If you can do without, leave the establishment without buying anything after registering your objection to a staff person so they are aware they’ve lost your business over it.
• Understand why some stores charge fees for credit card use. If you visit a store or restaurant that charges a higher price for credit card purchases, understand that this is a socially beneficial policy and be supportive. Merchants are explicitly permitted to pass swipe fees (also known as “interchange fees”) along to customers, which among other things is fairer to low-income customers who don’t have credit cards and shouldn’t have to absorb the costs of those cards. If you are a business, consider passing along those fees to increase fairness as well as customer awareness of how the current system works.
• Contact your elected representatives. We have already seen some cities and states ban cashless stores. Your state or city can do so as well.

The bottom line is that the technocratic “dream” of a cashless society is a vision in which we discard what is left of the anonymity that has characterized urban life since the dawn of modernity, and our freedom from the power of centralized companies like banks. Doing without cash may be convenient at times, but if we lose cash as an option we’re going to regret it later.

Jay Stanley, Senior Policy Analyst, ACLU Speech, Privacy, and Technology Project

The Trump Administration has shown it will stop at nothing to undermine access to health care for marginalized communities. Most recently, the Administration has proposed to undermine critical protections against sex discrimination in Section 1557 of the Affordable Care Act, the Health Care Rights Law. Instead of combatting discrimination in accessing health care and insurance coverage, the Administration is looking for any opportunity to weaken the Health Care Rights Law’s protections, which have been life saving for many transgender and non-binary people.

Under the Trump Administration, the Department of Health and Human Services (HHS) has abandoned its duty to fight against discrimination in health care. It stopped defending existing regulations in a lawsuit attacking protections for transgender individuals and people who have obtained abortions. HHS then turned around and cited that very lawsuit as a reason for changing the regulations. But HHS cannot use its failure to defend current protections as a reason to gut them.

The proposed rule removes explicit protections for transgender, non-binary, and gender nonconforming people, as well as for people seeking, or who have obtained, services related to pregnancy, childbirth, and abortion. The Administration has made clear that a central goal of the proposed changes is to excise transgender people from the protections of the Health Care Rights Law. Though their intent has been to “erase” transgender people, the Administration can neither erase transgender people from existing statutory protections nor exclude them from society. 

Case after case has confirmed that transgender people are protected under the Health Care Rights Law—and that is something the Administration cannot change even if this rule is finalized.

This isn’t just about definitions, though. This rule is yet another attempt by the Trump administration to undermine our nation’s antidiscrimination laws. The proposed rule would also: eliminate protections ensuring that people who have limited English proficiency are aware of their health care rights; narrow the list of health insurance providers covered by the Health Care Rights Law and prohibited from discriminating based on race, national origin, age, disability, or sex; and give religiously-affiliated health care institutions a broad license to discriminate on the basis of sex.

Even though one in six hospital beds in the United States is in a Catholic hospital, and the number of religious health care providers is only growing, the Administration wants to lift prohibitions on religious health care institutions discriminating based on a patient’s sex.

The proposed rule continues the Trump Administration’s mission to undermine access to health care for marginalized communities. So far they want to deprive people of coverage for contraceptives, decimate family planning services, dramatically expand the ability of health care institutions and workers to refuse to provide medical services, and penalize access to health care by immigrant women and children.

Transgender people already face threats of violence and discrimination in all aspects of their lives and the Trump Administration is inviting more. The Administration is intent on emboldening discriminatory and dangerous denials of care for transgender individuals. They have already banned transgender members of the military from openly serving and accessing certain critical medical procedures, reversed positions as to whether federal law protects transgender people from workplace discrimination, and proposed allowing taxpayer-funded shelters to turn away transgender people experiencing homelessness.

Despite these attacks by the Trump Administration we will continue to fight to ensure equal access to health care and coverage, free from discriminatory treatment or denials. For all these reasons, tens of thousands of people are telling HHS to abandon the proposed rule, and to keep the current Health Care Rights Law regulations in place – and I hope you join us in doing so.

Lindsey Kaley, Staff Attorney, ACLU

On Thursday, the U.S. Court of Appeals for the Ninth Circuit became the first appellate court in the nation to directly address the privacy harms posed by face recognition technology. The decision is a significant advance in the fight against the threats of face surveillance, sounding the alarm on the potential for this technology to seriously violate people’s privacy.

In Patel v. Facebook, a group of Facebook users from Illinois allege that Facebook violated the Illinois Biometric Information Privacy Act (BIPA) by using face recognition technology on the users’ photographs without their knowledge and consent. BIPA is the oldest and strongest biometric privacy law in the country, requiring companies to obtain informed consent before collecting a person’s biometric identifiers, including face recognition scans. Importantly, the law provides individuals in Illinois with a right to sue for damages if a company has violated their rights.

Facebook’s primary argument in the case was that in order to establish “standing” to sue, the plaintiffs should have to demonstrate some concrete injury beyond a violation of BIPA's requirement of notice and consent. As we argued in an amicus brief last year, surreptitious use of face recognition technology does cause harm, by subjecting people to unwanted tracking and by leaving them vulnerable to data breaches and invasive surveillance. Given the rapid proliferation of face surveillance technology in recent years, it is critical that Illinoisans are able to enforce BIPA’s protections against unwanted collection of their biometric information. A requirement that a person must demonstrate monetary loss or similar injury in order to sue would seriously undermine BIPA’s intent to safeguard against abusive collection of biometric data in the first place.

In Thursday’s ruling the Ninth Circuit agreed, holding that “the development of a face template using facial-recognition technology without consent (as alleged here) invades an individual’s private affairs and concrete interests.” 

To reach that conclusion, the court looked not only to the long-recognized entitlement of people to sue private parties over violations of common-law privacy rights, but also to evolving Fourth Amendment protections against law enforcement surveillance. This includes the landmark decision in Carpenter v. United States, an ACLU case about police access to cell phone location data decided last year. As the Ninth Circuit explained, drawing from language in Carpenter, “[i]n its recent Fourth Amendment jurisprudence, the Supreme Court has recognized that advances in technology can increase the potential for unreasonable intrusions into personal privacy… As in the Fourth Amendment context, the facial-recognition technology at issue here can obtain information that is ‘detailed, encyclopedic, and effortlessly compiled,’ which would be almost impossible without such technology.”

The Ninth Circuit’s ruling is important not only because it explains why surreptitious use of face recognition by corporations harms people’s privacy interests, but also because it puts law enforcement on notice that recent Supreme Court cases regulating other forms of electronic surveillance have something to say about face surveillance technology.

Indeed, the potential for this technology to enable the government to pervasively identify and track anyone (and everyone) as they go about their daily lives is one of the reasons the ACLU is urging lawmakers across the country to halt law enforcement use of face surveillance systems. This decision puts both corporations and law enforcement agencies on notice that face surveillance technology poses unique risks to people’s privacy and safety.

The Ninth Circuit’s ruling also demonstrates the importance of privacy laws including strong private rights of action, affirming people’s right to turn to the federal courts for redress when their rights have been violated. Without a right to sue, privacy guarantees will often prove ephemeral. As state legislatures and Congress move forward on consumer privacy legislation, they should follow Illinois’ lead by including private rights of action in these statutes.

Nathan Freed Wessler, Staff Attorney, ACLU Speech, Privacy, and Technology Project