SF3874

Purpose

• Require sellers that offer essential goods or services in Minnesota to accept United States currency (cash), including Federal Reserve notes, for in-person purchases.
• Help ensure consumers can pay with cash for essential needs and clarify when cash acceptance is required.

Main Provisions

• Definition and scope

  • Uses terms defined elsewhere: consumer, seller, and essential goods and services (as used in this section).
  • Applies only to essential goods and services offered for sale in Minnesota and only when payment is made in person.

• Cash acceptance requirement

  • A seller must accept United States currency, including Federal Reserve notes, from a consumer to purchase an essential good or service.

• Application and compliance rules

  • The requirement applies only if payment is made in person for the essential goods/services.
  • If a seller has multiple sales locations at a single address, compliance is met if at least one point of sale at that address accepts US currency.
  • The requirement does not apply to transactions where the consumer is required to provide a security deposit placed on a credit card or a credit card number to cover damages or expenses.

• Exceptions related to payment methods

  • Does not apply if the seller uses a device to convert cash into a prepaid card for the transaction under specific conditions:
  • No fee for the transaction.
  • Receipt provided showing cash amount deposited.
  • The prepaid card has no expiration.
  • The seller or prepaid card issuer does not limit the number of transactions.
  • The consumer can complete the transaction using the prepaid card.

• Exclusions for certain financial institutions

  • The law does not apply to a banking institution or a credit union.

• Penalty for noncompliance

  • A seller that fails to accept US currency as required may face a civil penalty of up to $250 per transaction or attempted transaction.

Significant Changes to Existing Law

• Establishes a new mandatory cash-acceptance requirement for essential goods and services in in-person sales.
• Introduces a civil penalty for noncompliance, creating a financial consequence for retailers that refuse cash.
• Clarifies that acceptance applies at least at one point of sale for multi-location sellers, with location-level compliance.
• Creates specific exemptions related to security deposits, credit card requirements, and prepaid card devices, including conditions under which cash-to-prepaid-card conversions are allowed.
• Excludes banks and credit unions from being subject to this section.

Potential Implications

• Retailers may need to adjust checkout processes to ensure at least one cash-accepting point of sale at each applicable location.
• Some payment kiosks or card-based systems may be used if they meet the defined prepaid card conditions, potentially easing cash handling for certain transactions.
• Consumers may have stronger protections or expectations around accepting cash for essential purchases.

Relevant Terms - United States currency - Federal Reserve notes - essential goods and services - consumer - seller - in person - point of sale - security deposit - credit card - prepaid card - device to convert cash - civil penalty - transaction - banking institution - credit union