France practices what is sometimes referred to as a hard version of legal tender. That means that the acceptance of cash is compulsory by law. According to article R642-3 of the penal code, the refusal to accept coins and banknotes which are legal tender is punished by a second-class fine, which is currently set at €150.
According to French media, Erick Lacourrège, the Director General for Services to the Economy and Branch Network Activities at the French central bank has written to retail organisations reminding them that they cannot refuse cash payments. The bank acknowledges that a growing number of retailers are declining cash payments, fearing that banknotes may contribute to spread the virus. “To date, there is no evidence to support the hypothesis that banknotes and coins are a vector in the spread of viruses such as the coronavirus. Consequently, the Banque de France reaffirms its message of reason and moderation with regard to the risk of contagion by cash, which is very low for any professional or individual who applies – as in any activity of everyday life – the health recommendations of the World Health Organization (in particular: wash or disinfect hands very regularly, avoid touching your face).” writes Erick Lacourrège.
He adds that for the most vulnerable, cash is often the only payment option available. In France, over 4 million people depend on social benefits which are mostly disbursed in cash.
The National Ombudsman has warned the government on 30 March that the refusal of cash payments by merchants is hurting the most vulnerable. The group includes those who are economically vulnerable but also those who are under curatorship, or tutorship or unaccompanied minors. He calls on the government to ensure that all retailers accept cash, as is required by law.
The Ombudsman also draws the attention of the authorities on the difficulties faced by some vulnerable people to access cash and in particular social benefits which are mostly disbursed in cash at post offices. As a result of social distancing and confinement policies, only 1,600 of the total 7,000 post offices are open during the pandemic and police forces have been summoned during to ensure security during the period of high demand. The Ombudsman acknowledges the efforts made by La Poste but warns that this may not be enough. People with disabilities, or under guardianship will struggle to withdraw cash.
In the UK, merchants are not required to accept cash. However, organisations representing consumers, the elderly and vulnerable groups are increasingly speaking out for cash. As the FT recently reported, “Contactless cards fuel fears of digital exclusion”.
“Contactless card payments work brilliantly for most of us, but they don’t work for everyone,” says Natalie Ceeney, independent chair at the Access to Cash Review. “That said, there are significant numbers of people in the UK that are solely reliant on cash.” says Gareth Shaw, head of money at consumer group Which?. “Banks must develop innovative new ways of getting cash to customers, so no older person who needs it is left cashless, for example by sending cash through the post in a similar way to foreign currency.” says Caroline Abrahams, charity director at Age UK, the UK’s largest charity for older people. “We would urge shops to continue to accept cash wherever possible.” adds Abrahams.