Philadelphia has become the first major US city to ban cashless stores and restaurants in a move designed to end discrimination against the unbanked.
According to the Wall Street Journal, from 1 July, most stores will have to accept cash and will also be forbidden from putting a surcharge on people paying with paper money. Firms that violate the law could be fined up to $2000.
There are exemptions for some businesses, including parking lots and garages, hotels, wholesale stores and car rental companies.
Philadelphia may be the first to make the cashless move but it is unlikely to be the last. The New Jersey Legislature is set to follow suit while New York City, Washington and Chicago are all investigating similar measures.
Cash usage is on the wane in many areas as Americans increasingly use cards and mobile payment options such as Apple Pay at the point-of-sale. This has prompted some businesses to ban cash, which is expensive to handle, outright.
However, proponents of measures such as the one in Philadelphia argue that cashless stores discriminate against the unbanked, poorer members of society that do not have access to credit cards or bank accounts.
In addition, cash is still popular with many, the favoured payment method for 26% of Americans, according to Federal Reserve numbers.
Philadelphia City Councilman William Greenlee, who introduced the bill, says: "Most of the people who don’t have credit tend to be lower income, minority, immigrants. It just seemed to me, if not intentional, at least a form of discrimination."