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Amazon threatens Philadelphia over plan to ban cashless stores

Cashless trend sparks worries: "It's elitism"

Amazon is threatening to scrap plans to open a brick-and-mortar location in Philadelphia over a proposal that would bar retailers from refusing to accept cash.

The city council on Thursday approved legislation that would require businesses to accept cash. Proponents say cashless stores discriminate against lower-income shoppers, who are less likely to pay for goods with credit or debit cards. The measure now awaits the mayor's signature.

Such a law would hamper Amazon in launching its Go stores in Philadelphia. The outlets have no cashiers and only accept digital payments, relying on sensors and automation software to let consumers make purchases without waiting in checkout lines. The company operates a total of 10 Go stores in Chicago, San Francisco and Seattle, and plans to open as many as 3,000 more by 2021, according to Bloomberg. 

Other businesses, including restaurant chains Sweetgreen, Dig Inn and Dos Toros, also have stopped taking cash. Business owners say going cashless speeds checkout lines, lowers costs associated with handling money and reduces the danger of theft.

Amazon declined to comment.

"Legal tender"

But as cashless retailers take root, lawmakers in several states have expressed concern about the potential impact on local residents. Along with in Philadelphia, bills have been introduced in New York, New Jersey and Washington, D.C., that would require businesses to accept cash. 

The only state that explicitly requires retailers to take cash is Massachusetts.

New York City council member Ritchie Torres has proposed legislation that bans cashless retail, citing the "exclusionary effect it will likely have on the most vulnerable New Yorkers" in a hearing on Thursday. Cash serves as an "equalizer" that allows New Yorkers to buy their choice of goods and services, while refusing it would widen the gap between rich and poor, he argued.

"When you open a dollar bill, it reads, 'This note is legal tender for all debts public and private.' Those words remind us that cash is the universal currency," Torres said. "Not everyone has access to debit or credit, but every one of us has access to cash."

Inside Amazon's first cashier-free store

Consumer advocates say the trend in cashless retail hurts people who lack checking or savings accounts, as well as those who are forced to rely on pre-paid cards with high fees or interest rates.

Meanwhile, even those who back restrictions on cashless stores say curbing the practice is only a band-aid. They say a more holistic remedy is needed to solve the real problem -- a lack of access to credit -- and to promote financial inclusion. 

-- The Associated Press contributed to this report