5 votes

If cash is king, how can stores refuse to take your dollars?

9 comments

  1. StellarV
    Link
    I'm posting this because of this comment: https://tildes.net/~humanities/8rm/do_you_have_a_moral_duty_to_leave_facebook#comment-2aap I thought it raised some interesting questions that deserve its...

    I'm posting this because of this comment: https://tildes.net/~humanities/8rm/do_you_have_a_moral_duty_to_leave_facebook#comment-2aap

    I thought it raised some interesting questions that deserve its own post and this seems like a good article to start discussion on the topic.

    2 votes
  2. [4]
    Pilgrim
    (edited )
    Link
    India recently outlawed (most?) cash and it resulted in some issues... https://money.cnn.com/2017/01/04/news/india/india-cash-crisis-rupee/index.html EDIT: As Algernon pointed out, my original...

    India recently outlawed (most?) cash and it resulted in some issues...

    https://money.cnn.com/2017/01/04/news/india/india-cash-crisis-rupee/index.html

    EDIT: As Algernon pointed out, my original comment is unintentionally misleading. India did away with various high value notes and replaced them with a fewer number of similarly valued notes in an attempt to fight money laundering.

    2 votes
    1. Algernon_Asimov
      Link Parent
      That article felt a bit incomplete, and it didn't align with what I remember being reported at the time, so I did some research. Here's the Prime Minister's speech: Basically, they replaced the...
      • Exemplary

      India recently outlawed (most?) cash

      That article felt a bit incomplete, and it didn't align with what I remember being reported at the time, so I did some research.

      Here's the Prime Minister's speech:

      To break the grip of corruption and black money, we have decided that the five hundred rupee and thousand rupee currency notes presently in use will no longer be legal tender from midnight tonight, that is 8th November 2016. This means that these notes will not be acceptable for transactions from midnight onwards. The five hundred and thousand rupee notes hoarded by anti-national and anti-social elements will become just worthless pieces of paper. The rights and the interests of honest, hard-working people will be fully protected. Let me assure you that notes of one hundred, fifty, twenty, ten, five, two and one rupee and all coins will remain legal tender and will not be affected.

      Now as part of this exercise, RBI’s recommendation to issue two thousand rupee notes has been accepted. New notes of five hundred rupees and two thousand rupees, with completely new design will be introduced. Based on past experience, the Reserve Bank will hereafter make arrangements to limit the share of high denomination notes in the total currency in circulation.

      Basically, they replaced the existing 500 and 1,000 rupee notes with new 500 and 2,000 rupee notes - with the proviso that all old notes had to be handed back immediately, and there would be limits on the number of new notes circulated.

      There's more information about this on Wikipedia.

      India did not outlaw cash. That's an EXTREMELY misleading summary of what happened. They just reduced the number of high-value notes in circulation.

      9 votes
    2. [2]
      StellarV
      Link Parent
      I can't believe they thought this was a good idea with so much of the country living in poverty or extremely primitive conditions in some areas. I know they've been pushing very low end...

      I can't believe they thought this was a good idea with so much of the country living in poverty or extremely primitive conditions in some areas. I know they've been pushing very low end smartphones but even then there's many people with just the clothes on their backs that rely on charity to survive.

      4 votes
  3. vakieh
    Link
    This is an issue based in a common misconception in Australia also. Australia has the legislative idea of 'legal tender', which some people take to mean 'you are legally required to accept this as...

    This is an issue based in a common misconception in Australia also. Australia has the legislative idea of 'legal tender', which some people take to mean 'you are legally required to accept this as payment' - and they're correct, when that payment is towards an established debt - especially a debt which arises without agreed terms of payment, like a fine or civil suit. However, it does not legally mandate the acceptance of cash as part of a contract, which is (grossly simplified and with much more specific legislation over the top) how retail works in this country (and I expect all common law countries).

    We've already got cashless businesses here, and they're increasing rapidly. So long as the government keeps up with caps on transaction costs so we don't end up with middlemen rent seekers in the form of banks or credit providers it should prove a significant net benefit.

    2 votes
  4. [3]
    Algernon_Asimov
    Link
    ... huh? It's enshrined in law, but there's no statute? Aren't they the same thing?

    The second reason is that while the statement on each piece of currency is enshrined in federal law, there’s no actual federal statute that requires companies to accept it.

    ... huh? It's enshrined in law, but there's no statute? Aren't they the same thing?

    1 vote
    1. Greg
      Link Parent
      That's how I read it, at least. I feel as though it's somewhat moot anyway, though - existing experience suggests that even if a business did have to accept cash when they didn't want to, they'd...

      The second reason is that while the statement on each piece of currency is enshrined in federal law [for all debts], there’s no actual federal [law] that requires companies to accept it [for non-debt transactions].

      That's how I read it, at least. I feel as though it's somewhat moot anyway, though - existing experience suggests that even if a business did have to accept cash when they didn't want to, they'd just put a punitive surcharge on cash transactions to the extent that nobody used them.

      1 vote
    2. spit-evil-olive-tips
      Link Parent
      It sounds like there's an act of Congress requiring the Bureau of Engraving and Printing to put that statement on money, but nothing from Congress requiring businesses to actually accept that cash.

      It sounds like there's an act of Congress requiring the Bureau of Engraving and Printing to put that statement on money, but nothing from Congress requiring businesses to actually accept that cash.