Alert: New Jersey Bans Cashless Stores and Restaurants


Only a few weeks after Philadelphia became the first major U.S. city to ban cashless stores and restaurants, New Jersey Governor Phil Murphy has signed a new law banning cash-free businesses throughout the state of New Jersey. Violators of the new law, which is effective immediately, will be fined up to $2,500 for a first offense and up to $5,000 for a second offense. Subsequent offenses would subject business owners to fines under New Jersey’s Consumer Fraud Act, which could mean penalties of up to $20,000.

Supporters of the ban cite classist implications of the cash-free business model, as well as privacy concerns. “This idea of ‘we don't want to accept cash’ just marginalizes the poor, young people who haven't established credit yet, people who prefer to pay in cash,” said Democratic Assemblyman Paul Moriarty. “And then there’s those who don’t want every aspect of their life recorded, stored and monetized by credit card companies, right down to the purchase of a stick of gum.”

Business owners opposing the ban have pointed out that cashless establishments are less vulnerable to robberies, and have also cited faster checkout times and more accurate accounting. “Consumers of all income levels are able to access pre-paid cards for purchasing,” said Michael Wallace, vice president of government affairs for the New Jersey Business and Industry Association. “As such, this law will ultimately stifle innovation and act as a further deterrent to doing business in New Jersey.”

Like the Philadelphia law, the New Jersey law includes exemptions for transactions made online, by phone and by mail, as well as for parking facilities, rental car companies and airport vendors. Specifically, the New Jersey law excludes municipal-owned parking facilities, parking facilities that only accept mobile payments, car rental companies that accept cashier’s or certified checks, and airports so long as they have a terminal with at least two food retailers that accept cash.

The New Jersey law will effectively prohibit Amazon Go cashierless stores, where customers can automatically be charged through their cellphones. While there is an argument to be made that Philadelphia’s ban does not apply to Amazon Go stores—it allows stores based on membership, like Costco, to remain cashless, and Amazon Prime is a membership program—no such exemption exists in the New Jersey law.

New Jersey is the second state to institute a state-wide prohibition on cashless establishments, following Massachusetts’ 1978 ban.


If you have any questions or would like to discuss these issues, you can call Bill Matthews at 215.569.4281,, or Adrienne Beatty at 215.400.2850, Mr. Matthews is the Chairman of the firm’s Corporate and Securities Department who concentrates his practice in securities, mergers and acquisitions and general corporate counseling for a wide range of clients, from family-owned businesses to emerging growth businesses to public companies. Ms. Beatty is a member of the firm’s Corporate and Securities Department and devotes the majority of her practice to corporate matters, including mergers and acquisitions, private equity financing, fund formation, corporate governance issues, and other contractual and transactional matters.

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