Law Allowing Cash Rent Payments Takes Effect

DOWNERS GROVE, Ill. — Renters are guaranteed additional flexibility in payment options under a new law passed by state Rep. Anne Stava-Murray, D-Downers Grove, ensuring tenants have the option of paying in cash.

“As new innovations come into wider use, it’s important that we consider how they impact every member of our communities,” Stava-Murray said. “Electronic payments have greatly simplified the payment of rent for many of us, but for others their exclusive adoption by landlords has created problems.”

Stava-Murray’s House Bill 1628, which went into effect on Jan. 1, prohibits landlords from requiring tenants or prospective tenants to pay amounts due to the landlord using electronic funds transfer (EFT) from a bank account. Effectively, this means that landlords cannot prohibit the payment of rent using cash.

The law applies to leases, renewals and extension agreements that began on or after Jan. 1, 2024. Beginning 90 days after that date, landlords who fail to comply with the new law may face penalties under Illinois’ Consumer Fraud and Deceptive Business Practices Act, which allows the state’s Attorney General to seek civil penalties of up to $50,000.

Payment via EFT can pose difficulties for tenants who are paid mostly in cash, such as service industry workers, as well as for anyone who lacks access to a checking account.

The law does not prohibit landlords from using an EFT system or from accepting EFT payments. It only prohibits payment by EFT from being an exclusive requirement.

“Paying the rent can be burden enough for many in our communities without extra requirements that payment be in a certain form,” Stava-Murray said. “Nobody should be at risk of eviction, penalties or damage to their credit because a landlord won’t accept a valid form of payment. That’s why we’re making sure that everyone can pay rent in the way that makes sense for them.”