This summer, when the roller coasters rumble and crowds queue at Michigan’s Adventure, one thing will be different: the amusement park will be cashless.
Michigan’s Adventure joins a growing trend of Michigan businesses, venues and organizations eliminating cash transactions. But don’t worry, cash isn’t going away.
Three major Detroit venues, Comerica Park, Little Caesars Arena and Fox Theater recently went cashless, as did LMCU Ballpark near Grand Rapids announced plans switch this summer. They say going cashless is safer, safer and faster for customers.
There are also benefits to the park, according to Laure Bollenbach, communications manager at Michigan’s Adventure.
“There is no need to pay for armored cars to haul money back and forth from the parks. No more wasting time and effort counting cash,” she wrote in an email. “And from a practical point of view, it’s getting harder and harder to find coins.”
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Cash payments have been steadily declining in the United States, likely accelerated by the COVID-19 pandemic, as cash transactions fell 26% to 19% from 2019-2020 the latest data from the Federal Reserve.
Square, a leading payment system, reported that cash transactions for US companies fell another 8.3% last year.
“The shift in the payments landscape during the pandemic accelerated the shift in preferences from cash to credit and debit cards, a trend that had been changing rather slowly over the five years leading up to 2020,” Kelsey Coyle, Laura Kim and Shaun O’Brien of the Federal Reserve Bank of San Francisco wrote in a report last year.
Though cash is becoming less common among American consumers, critics say it shouldn’t be phased out entirely because it penalizes the unbanked. And several states, including Massachusetts, New Jersey and Rhode Island, have banned businesses from going entirely cashless.
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About 5.7% of Michiganders are reported to be unbanked an FDIC survey, and another 15.2% are underserved, people who have accounts but typically rely on check cashing services or payday loans. Nationally, these rates are highest in low-income, Black, Hispanic, and Native American households and households headed by someone with a disability.
Because of this, some Michigan cashless businesses have turned to card kiosks instead, offering a solution for cash-only customers.
Card machines located throughout Little Caesars Arena, Michigan’s largest indoor venue, allow people to exchange cash for a prepaid card at no additional cost. Similar kiosks are available to students and staff who carry cash at Grand Valley State University, which completed a year-long transition to a cashless campus in January.
“Cash obviously isn’t going away,” said Craig Wieschhorster, executive vice president of business and finance at Grand Valley.
As one of the first Michigan universities to be completely cashless, Wieschhorster makes operations more efficient and reduces the risk of potential fraud.
“With cashless payments, you have more confidence in every transaction because you can count dollar for dollar on those transactions,” he said.
A recent study by The University of Georgia proposes eliminating cash transactions, which are anonymous and difficult to trace, could help curb tax evasion. This could ultimately lead to higher government revenues and benefit Americans on a daily basis.
“Our paper showed that, in principle, cash could be eliminated and income and capital tax rates lowered in ways that would improve the economy — people’s well-being — overall,” said Dr. William Lastrapes, one of the University of Georgia researchers and an economics professor, in a written response to MLive.
Getting rid of cash would negatively impact people who carry only cash, mostly low-income Americans, Lastrapes said, but he suggested getting rid of big bills like $50 and $100, which are commonly found in the “underground economy.” be used.
“Probably the best way to avoid imposing high costs of currency suppression on low-income and older Americans would be to just eliminate big bills, at least in the short term,” he said.
According to Lastrapes, the United States is unlikely to go completely cashless any time soon, and most Americans agree. A survey conducted by Square found that 73% of consumers and 68% of business owners do not envision a cashless future.
“As people become educated about new and better ways to conduct transactions, the demand for cash is likely to continue to decline,” Lastrapes said.
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