Cashless Stores and Cash Users

26 Pages Posted: 9 May 2019 Last revised: 21 Oct 2019

See all articles by Oz Shy

Oz Shy

Federal Reserve Banks - Federal Reserve Bank of Atlanta

Multiple version iconThere are 2 versions of this paper

Date Written: 2019-05-01


The emergence of cashless stores has led several cities and states to ban such stores. This article investigates this issue by characterizing consumers who pay cash for in-person purchases and consumers who do not have credit or debit cards. Using a random utility model, I estimate 1.3 to 30.9 percentage drop in average per-payment consumer surplus if all stores were to become cashless and when utility is measured by the cost of making a payment, security, and convenience. The conclusion provides a discussion of alternatives to cash for in-person purchases that may be needed before all brick-and-mortar stores become cashless.

Keywords: cashless stores, banning cashless stores, consumer payment choice, in-person purchases, alternatives to cash, random utility

JEL Classification: D9, E42

Suggested Citation

Shy, Oz, Cashless Stores and Cash Users (2019-05-01). FRB Atlanta Working Paper No. 2019-11. Available at SSRN: or

Oz Shy (Contact Author)

Federal Reserve Banks - Federal Reserve Bank of Atlanta ( email )

1000 Peachtree Street N.E.
Atlanta, GA 30309-4470
United States

HOME PAGE: http://

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
PlumX Metrics