Your money is no good

Amillion years ago when I was 14, I worked at Baskin & Robbins here in Starkville. ( The building no longer stands and most people in town don't even know it ever existed. I'm aging myself.) I was emotionally scarred by having a customer call our manager with a complaint about my service. He had attempted to pay for his ice cream with a Susan B. Anthony dollar coin and I had refused it, never having seen one and not believing it was actual currency. His point to me was valid: “It's US legal tender.” But I remained firm in my skepticism. I was wrong.

Believe it or not, according to a piece in AARP The Magazine, it has never been a legal requirement for a business to accept US legal tender, however now with the growth of cashless businesses, some states and cities have passed laws to ensure that consumers can pay with cash. In fact, a 2021 bill was introduced to the House of Representatives that would establish a federal law prohibiting businesses from refusing cash. It's not expected that this law will pass, but man – wouldn't our parents/ grandparents think they'd landed in a twilight zone?

It used to be that businesses preferred cash, largely because the swipe of a card cost them additional processing fees. I even remember businesses tacking this fee onto a non- cash/ noncheck transaction. Those card fees still exist at an average of 2.22 percent, but what has happened is that businesses have come to see that taking the human element out of the transaction has saved money in other ways to make up for that processing fee.

For example, one merchant in this article stopped taking cash at a select group of its stores in 2016. Those stores recorded 15 percent more transactions per hour through their registers. They also saved two hours per day on things like balancing drawers and making bank deposits. My thought, though it wasn't reported, is that the opportunity for cash- counting mistakes or outright dishonesty was removed, as well. Additionally, it's been proven many times that people tend to buy more and tip more when using non- cash means of payment. And finally, transaction reporting through electronic means is immediate; the store's system knows so much more about the noncash customer – who we are, how we shop, what we want, etc.

So if the world is moving to cashless… and don't get me wrong; I don't think it actually will in our time… how can we move with it and still be safe? Here's what I learned in my research.

Our smartphones have “wallet” technology. That much, I knew. We can load our debit and credit card information into our smartphones, and even our passport and driver's licenses, loyalty cards and boarding passes, among other things. The full card number is not visible in the phone, which protects it in the event our phones are lost or stolen. Then when we get ready to pay for our goods and services, more and more store check-out systems allow us to simply open the “wallet” on our phones and using proximity technology to pay for our goods without ever swiping, signing… nothing.

I have been loathe to adopt this technology, imagining that it put my information out into the world a bit more than made me comfortable. What I have learned, however, is that smartphone wallet technology is actually more secure than swiping my card. First, the transaction doesn't go through until I verify my identity with a passcode or face recognition. Second, and I feel this is crucial, the transaction does not give my card/ payment data to the store's system. How about that? This concept uses a process called tokenization. This process takes a sensitive data element and substitutes it with a nonsensitive element, called a token, which has no value in and of itself. How does this help you?

If you use your debit card at a restaurant, for example, it is possible for a hacker to then lift your card information from the restaurant's payment reader. Tokenization makes this theft impossible. Given that I have had my card information lifted at a restaurant in just this fashion, I am taking a serious look at changing my habits. In fact, I will just say it – I'm loading up my phone wallet today.

I hope this piece encourages you to perhaps rethink how you pay for items in public places. We can fight technology, or we can open our minds to the possibility that some of these changes are for our betterment. Having a bank or other account hacked is simply miserable. Tell your friends what you've learned today and consider letting go of those Susan B. Anthonys!

Barbara Runnels Coats, MBA, FICF, RICP, Modern Woodmen of America Financial Representative.