It was the journalist Sarah Jeong who said: A cashless society promises a world of limitation, control, and surveillance, all of which the poorest Americans already have in abundance.
Since the February 8th, 1950 introduction of the Diners Club Card, there has been a movement in America to do away with physical cash transactions in favor of smoother electronic payments. Jack Lefler ran a piece in 1968 with pundits predicting a world where we would all be Cashless, leading to the creation of what today is known as the Cashless Society Movement.
The Cashless Society argues that we should do away with physical cash as a payment option because having a lot of cash on hand increases the probability of robbery and theft, money laundering incidents will be significantly reduced, and we can have more efficient currency exchanges. While these are major concerns, there’s a denial of a variety of harsh realities that cash as a payment option helps remedy.
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Cash-Only Businesses Like Dispensaries
Until marijuana is rescheduled from Schedule 1 to Schedule 3, or the SAFE/SAFER Banking Act is passed, the only compliant payment methods for state-regulated dispensaries will be cash and ACH. Because ACH will be used mainly for B2B transactions, B2C transactions will be dominated by cash. This makes the concept of eliminating cash as a payment option even more outrageous because how can cash-only businesses (such as dispensaries) operate if cash is no longer available?
Enter The Cash Society
In response to the Cashless Society, there has been an alternative uprising that I refer to as the Cash Society Movement, a group of finance professionals with no issues with the electronic payments, but who want to remind the country that cash still plays an essential role in today’s economy, with some of those ways being listed below.
The Underbanked and Unbanked
According to an FDIC Survey, we still have 5.6 million American households who are unbanked and 19 million American households who are underbanked. To be unbanked means you have no access to the banking system, and to be underbanked means you have “some access” but are significantly underserved. A lack of access to banking leaves many of the unbanked and underbanked to rely on check-cashing stores, which could cost anywhere from 1 percent to 10 percent of the value of your check to cash it.
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Impulse Purchase Control
When my industry began pushing businesses to accept credit cards, the main selling point was that they could see 10 percent or more added to each sale due to impulse buying. The convenience of buying now and paying later made the credit card a preferred payment option because customers didn’t feel the emotional impact of the purchase right away.
However, this has led to a number of Americans spending beyond their means and falling into high levels of credit card debt for consumer discretionary purchases. So, cash would be the perfect payment option for individuals looking to get out of debt and pull back on impulse purchases because you can’t spend more than you have. Plus, you’ll buy now and pay now, immediately feeling the emotional impacts of the purchase, which could deter you from buying items you don’t need and can’t truly afford.
Emergencies and Privacy
Having cash on hand helps when electronic payment systems are down and allows one to trade in a more private manner.
3rd Most Used and Highest Currency In Circulation
Despite all of the forces against cash, cash is still the 3rd most used payment option today, according to The Federal Reserve’s 2024 Diary of Consumer Payment Choice. From the same study, it’s noted that consumers are holding more cash today than they did before 2020, both as a store of value, both at a store of value and as a backup payment option. In addition, we have more currency in circulation than ever before. According to the Feb 2025 Money Stock Report, there’s $21.6 trillion of currency in existence, with $2.35 trillion of said amount being in physical format and circulation.
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The Government Pushback
Understanding the necessity of cash, regulators are pushing back on the Cashless Society‘s attempts to make cash go extinct. On a national level, there’s the bipartisan Payment Choice Act, which would fine businesses up to $5,000 for going “cashless”. Then, a number of state and local governments are creating their own laws to ban “cashless” stores, including cities like Berkeley, Detroit, New York City, Philadelphia, San Francisco, and Washington, DC. States taking this stance include Colorado, Connecticut, Delaware, and Massachusetts.
The Future Of Dispensary Payments
In 2024, the DEA submitted a proposal to reclassify marijuana from Schedule 1 to Schedule 3 (drugs with low or moderate psychological dependence). In late 2024, the proposal went in front of an Administrative Judge, and subsequent hearings were scheduled in early 2025, but as of April 2025, the discussion has been postponed and listed as “Pending”.
In the event that cannabis is rescheduled or the SAFE/SAFER Banking Act is passed, dispensary payments could mimic the traditional retail market, where at least 50 percent of payment volume comes from credit and debit transactions.
Furthermore, with the rise of banking-as-a-service solutions (where any company can become a financial services company), electronic payments will continue to be embedded, hidden, and ubiquitous going forward. However, this doesn’t eliminate the continued need for physical cash as a payment option. Metaphorically speaking, cash might no longer be “king”, but it still packs a mighty roar.
*This article was submitted by a guest contributor. The author is solely responsible for the content.