A recent vote by the Human Rights Commission in the city of Austin has recommended and brought forward to the Austin City Council that the council discusses and considers banning all local businesses from not accepting cash payments from residents.
One of the board members was quoted as stating that the issue is one that matters due in large part to the fact that there are many individuals in the city that do not actually have bank accounts and are therefore unable to use credit or debit cards at local businesses. Furthermore, he stated that Austin is a city that has a reputation of being more inclusive, which is something that the commission wants to continue to see.
One of the local businesses cited as not accepting cash payments at the present time is Honest Mary’s Restaurant, who says the reason they are cashless is because it allows for a faster checkout process, as well as lower overhead and simplicity. Furthermore, they state that the money spent on armored trucks and late-night accounting is what ultimately saves customers money.
The FDIC conducted a national survey back in 2017 of households throughout the United States who were unbanked, meaning that no one in a home had either a savings or checking account in their name. The result of the survey that year showed that approximately 8.4 million households throughout the country did not have either of these accounts. Additionally, it was also found that around 24.2 million households throughout the country were also underbanked, meaning that they had a checking and savings account, but still chose to use other financial services such as payday loans, money orders, rent-to-own services, and check cashing.
Furthermore, a 2018 Washington Post article stated that immigrants and people of color had a much harder time being able to open and maintain bank accounts regardless of which specific banking institution they applied to, with one specific issue citing a Hispanic woman and her husband having their accounts with Bank of America frozen once the bank asked them to provide their addresses and Social Security numbers, despite the bank already having that information. Additionally, a man from Tennessee stated that the same bank demanded to know about his U.S. citizenship otherwise his account would be frozen.
It should be noted that in the United States, you are not required to provide proof of citizenship in order to open a bank account, despite the fact that institutions such as Bank of America, Chase, Citi, and Wells Fargo all have citizenship-related questions on their banking applications. Furthermore, on the official website for Bank of America, it is stated that customers will need to apply at a financial center in-person for an account with them if they have a limited credit history, difficulty being able to prove identification, and have any issues with their checking history.
In terms of the Austin initiative, it is expected that the recommendation should be moving forward to Austin City Council sometime within the next few months.
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