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Things to Consider When Moving From A Cash Only Business To Accepting Credit Cards


Cash only businesses were very common historically for most small retailers. The delay and expense in card processing and lower security than cash transactions long made the cost-benefit analysis cut against accepting cards for many vendors. The advances in card, smartphone, and card processing technology have changed the market considerably in recent years. In order to be competitive, many retailers find that they have to be responsive to their customers’ payment preferences. Many customers today carry little or no cash and expect to be able to present a card for virtually every purchase, no matter how large or small.

The traditional reasons that many small businesses have not accepted card payments include the cost of processing fees and the hardware necessary to accept payments. Now with new legislation, Cash Discount allows business owners to save on the cost of processing credit cards, while providing a cash discount to those who still choose to pay with cash.

With advances in the card processing industry, many small businesses have lowered concerns about card payments, especially given the risks and limitations involved in working with cash payments only. Working only with cash involves a much greater risk of loss, as cash has to be kept safe and transported before and after working hours and to a banking facility.

Accounting and reconciling cash receipts and disbursements from registers, coupled with the risk of employee errors and theft, make electronic card payments more attractive to businesses of all sizes. Card payments are inherently documented electronically, and long-term record keeping is greatly enhanced when payments are processed electronically.

Another very important consideration when thinking about moving into accepting card payments is consumer psychology. The research is voluminous and consistent -- people spend more money with a card than they do with cash. Pulling out cash or writing a check is simply more mentally difficult than handing over a card for payment. Customers are more likely to make an impulse purchase with a card than with cash, and they will almost always spend more on individual sales with a card. Adding on extra items or upgrading a purchase is much more likely when a customer knows they are going to pay by card. Service sector sales consistently include greater tips when payment is made by card.

At the end of the day, the customer’s preferences must drive the entrepreneur’s decision about whether to transition from cash-only to also accepting card payments. Large retailers are taking advantage of customers’ desires to make small purchases by card and cater to coffee, sandwich, and other small purchases at registers designed just for those small card transactions. In order to remain competitive, small businesses should present customers with the payment options that are convenient for them.

PayHub Payments offers innovative and seamless payment processing for your brick and mortar retail spaces and your eCommerce stores. We work with startups of all sizes and across all industries and businesses and we will be your payment processing partner from the ground up as you start a new venture or transition away from cash-only sales. We are here to help maximize your revenue from all card transactions and to keep your processing fees manageable and predictable. Contact us today for all of your business’s payment processing needs and we will explain our transparent and reliable fee structure and your business’s individualized needs.

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