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Danny Meyer stands by restaurant group's cashless push: 'We're unaware of any federal law' that requires accepting cash

Key Points
  • Union Square Hospitality Group faced criticism after testing cashless operations at select restaurants.
  • Digital payments have proven popular in China and other Asian countries where payment-enabled mobile phones leapfrogged over traditional credit and debit cards.
  • A large-scale rollout of cashless operations for Union Square Hospitality could expedite the adoption.
Danny Meyer
Adam Jeffery | CNBC

Shake Shack founder Danny Meyer is defending his restaurant group's push into cashless transactions, saying in a blog post, "we're unaware of any federal law that requires private businesses to accept [cash]."

Meyer owns Union Square Hospitality Group, which faced criticism after testing cashless operations at select restaurants. Shake Shack was founded by both Meyer and Union Square Hospitality.

"We know that some have raised concerns about the socioeconomic implications of operating a cashless business," Meyer said in the post. "By not accepting cash, a restaurant may be excluding prospective guests who do not have a bank account. And we might be inconveniencing guests who simply don't have their credit/debit on them at the time. That's certainly not our aim."

Meyer said the company is sticking with the shift for safety considerations and improved efficiency for customers. It's a notable stamp of approval for the digital technology that has been slowly gaining traction in the U.S.

Digital payments have proven popular in China and other Asian countries where payment-enabled mobile phones leapfrogged over traditional credit and debit cards. A large-scale rollout of cashless locations for Union Square Hospitality could expedite the adoption.

Meyer has a nearly 2 percent stake in Shake Shack, which has previously tested going cashless at one location. Union Square Hospitality declined to comment on the burger chain.

Read Meyer's full post on why Union Square is committed to cashless.

— CNBC's Sarah Whitten contributed to this report.