Evan Rogers

Beginning in the 2023 fall semester, Lares Cafe no longer accepts cash. The dining services at University Park and other Penn State satellite campuses have also gone cashless.

Cashless payment is a growing trend in the American economy. According to a 2022 study done by the PEW Research Center, “roughly four in ten Americans (41%) say none of their purchases in a typical week are paid for in cash.” The same study found that 14% of Americans make all or almost all, of their purchases in a typical week with cash. The trend towards a cashless economy has its advantages and disadvantages.

Cashless payments for many people are more convenient due to the flexibility of different methods of payment that can be used. Checkout can be faster since there is no cash exchange. For businesses, it can keep down costs on human error accounting for money, robberies, and time training employees to use a cash register.

However, some cities and states have banned cashless payments. Philadelphia and New Jersey, where many of Penn State Abington students reside, have banned cashless payments. San Francisco, New York City, and since 1978 Massachusetts, have also passed bills to ban businesses from going cashless. Many other states this year have new bills that are preventing businesses from using a cashless payment system on the grounds of increased inequity.

According to a survey done by the FDIC in 2021, approximately 4.5% of households were unbanked, meaning that no one in the household had a checking or savings account. According to the same survey, “unbanked rates were higher among lower-income households, less-educated households, black households, Hispanic households, working-age households with a disability, and single mother households.”  Households that need cash to purchase necessities.

Penn State Abington is the most diverse Penn State campus, making it more likely that students and their households are possibly being affected by cashless payment. In 2019, Former City Councilman William Greenlee, who introduced the bill that put a ban on cashless payment in Philadelphia, said, “It just seems unfair to have that separation. It’s almost like it’s ‘us’ and ‘them.’”

Credit cards can be used as a cashless payment if a person doesn’t have access to a checking or savings account. But not everyone has access to credit cards, either. Credit cards can also be harmful to businesses and the consumer. Businesses pay a fee between 1.5%-3% of every transaction a consumer makes. The business can pass that fee onto the consumer or raise the cost of goods to offset this fee.

These processing fees are so profitable for credit card companies that in 2017, Visa paid 50 food and restaurant vendors $10,000 each to go cashless in a push for a cashless society.

Lares Café is now part of that cashless payment trend. Although cashless payment has its advantages  being faster and easier, it has marginalized other students and left them without a place to eat on campus.