DENVER — A bill signed by Gov. Jared Polis this week will mandate Colorado businesses accept cash.
At the onset of the pandemic, many establishments implemented cashless policies due to COVID-19 transmission concerns. The bill, sponsored by two Democratic lawmakers, Rep. Alex Valdez and Sen. Robert Rodriguez, was seen as a proactive step to ensuring cashless policies didn't become permanent fixtures across the state.
"This bill really came from hearing from constituents about problems they were having spending cash at their local merchants, everything from grocery to coffee. When the pandemic started, it really exacerbated a problem that had already started... folks were having trouble accessing their staples in life," Valdez said. "I heard from a constituent who was having trouble buying kind of the basics: eggs, milk — things you need to survive with — at the local store. Then, they had to end up walking a great deal distance further to go to a store that did accept cash."
Similar legislation has passed in other states, including New Jersey back in 2019. The bill includes exceptions for businesses that rely on machines to accept payments.
"Rental cars, hotels where there is a security deposit involved, we made sure we created some language in there to ensure that those companies weren't left exposed from a security deposit perspective," Valdez said.
Valdez said he believes the bill will also help ensure Colorado's unbanked population has equal access to life's necessities.
"That's really what this bill is all about: ensuring that everybody in Colorado has access to the basics. And when you talk about folks who are unbankable, it's a larger population than you think. Some say 15% of the state of Colorado is an unbankable state," he said.
Several businesses went cashless during the pandemic, but have since rolled back or plan to roll back the policy.
"Nobody knew how COVID was transferred and whether money was a big issue — cash particularly — surfaces and whether surfaces were an issue or not, so we decided for safety reasons, we weren't going to take cash and to see how that worked," said Darden Coors, CEO of MAD Greens.
MAD Greens went cashless from April 2020 through the end of March this year. Coors said in the time that they solely accepted electronic payments, the business discovered more in-house efficiency.
"The manager doesn't have to leave the building to go the bank, and we're not spending, could be, up to two hours a day managing cash, in and out of the safe, in and out of the drawers, counting, changing cashiers," Coors said.
She added the cashless policy also helped employees dedicate more time to the new cleaning protocols being rolled out at the start of the pandemic. But for the future, Coors said they'll continue to accept all forms of payment.
Over in Arvada, New Image Brewing rolled back its cashless policy even sooner.
"We actually started accepting cash probably back in September," said Gavin Estes, general manager of New Image.
Estes said once the CDC updated its guidance on how COVID-19 was transmitted, that's when they decided to begin accepting cash again.
"Most of our customers use cards anyway, but after we saw those updated studies, we decided it was time to accept both forms of payment," he said.
Over at Illegal Pete's, a quick-service burrito shop with 12 locations, the cashless policy ended this month.
"We're just seeing that the feedback we're getting from our employees and our customers, it just feels as if it's the appropriate time to reintroduce cash back into our market," said Devin Rombough, director of operations for Illegal Pete's.
Throughout their cashless policy, Rombough said they've operated under another condition, too.
"We've implemented a policy where if somebody comes in and wants to pay with cash and doesn't have it [a card], we always buy their meal," he said.
According to findings completed by the Federal Reserve System, cash payments were as high as 30% in 2017 but dropped to 26% by 2019, while card payments have steadily increased.
"Even before the pandemic, for many firms, cash is a problem. It's difficult to handle, you have to have a cash drawer each day. At the end of the day, you have to do something with that cash to get it deposited somewhere. You've always got the threat of theft with cash," said Mac Clouse, a business professor at the University of Denver.
He said those trends, shouldn't keep currency from being accepted.
"You're always going to have part of the population that just doesn't want to use the credit cards, debit cards or an online method," he said. "They shouldn't leave out the consumers that just don't have that capability."
Clouse said a person's finances, technology access or privacy concerns are just some of the reasons why people may not want to bank. He said businesses that want to move towards a specific payment method should consider incentives.
"For example, if you want to use electronic payments primarily, make a policy that you have to pay more if you want to use cash, but at least you can use cash, and you can get a better deal if you’re willing or have the capability to use a debit or credit card."
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