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New Jersey businesses are no longer able to prohibit customers from paying in cash for in-person purchases.

Gov. Phil Murphy today signed A-591/S-2785, making it illegal to force customers to pay by credit or debit card or to refuse to accept legal tender for retail transactions. Penalties could be as much as $2,500 for a first violation and $5,000 for a second violation.

NJBIA opposed the bill, viewing it as unnecessary overregulation.

“Today’s signing removes a business owners right to freely determine how they would like to receive payment for their products and services,” NJBIA Vice President Michael Wallace said. “The preference for retailers to run a cashless business is often based on efficiencies and, in some cases, as a safety measure.

“Consumers of all income levels are able to access pre-paid cards for purchasing,” he said. “As such, this law will ultimately stifle innovation and act as a further deterrent to doing business in New Jersey.”

The law includes some important exemptions. Cash transactions and payments made by mail or over the telephone can be prohibited, and the provisions of the law do not apply to services at an airport if a certain number of food providers onsite accept cash.

Parking facilities owned by a municipality or private parking lots only accepting mobile payments are exempt as well.