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This law applies broadly to food stores and retail establishments operating within New York State that sell goods or services directly to consumers. A “food store” includes any business that sells food or beverages to the public for consumption either on or off the premises, including restaurants, cafés, grocery stores, food trucks, pushcarts, stands and similar mobile or fixed vendors. A “retail establishment” includes any business that sells, displays or offers consumer goods for sale, or provides services for consumers at retail, such as clothing stores, convenience stores and other consumer-facing shops. Banks and trust companies are expressly excluded and are not subject to the law.
There are limited circumstances in which businesses may refuse to accept cash payments. These include declining cash bills denominated above $20, and declining cash for telephone, mail or internet-based transactions, unless payment is made in person at the business’ premises.
The law also provides an exception for businesses that offer an on site cash to card option. A food store or retail establishment is not required to accept cash if it provides a device on the premises that converts cash into a prepaid card, provided the device does not charge a fee and does not require a minimum deposit of more than $1. The device must provide a receipt upon request, and funds loaded onto the prepaid card may not expire or be subject to limits on the number of transactions. If the device malfunctions, the business must accept cash during the outage and must post a conspicuous sign, on or immediately adjacent to the sign, informing consumers of their right to pay with cash.
As many businesses, particularly those in the hospitality and tourism industry, have gone to “cashless” business models over the past several years, these requirements form a new challenge, one that may require additional changes to information technology systems and infrastructure, cash-handling policies and procedures, and even floorplans. Businesses should be aware that the Attorney General encourages consumers to report suspected violations of this law to her Office and establishments that fail to comply may face maximum civil penalties of $1,000 for the first violation, and up to $1,500 for each subsequent violation. It is imperative that previously “cashless” businesses make immediate plans to once again accept cash for purchases to avoid potential enforcement activities.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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