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Cash Only or Accepting Credit Card Payments? What's Right for You?

Brant Schelhaas

“Cash or credit?” — an old, familiar question that used to be standard when shopping at your local hardware store, supermarket or department store. These days, however, the clerk is more likely to assume you are paying with a card, since most people do. There are some situations in which accepting cash can be beneficial. Let’s take a look of the benefits of accepting credit and debit cards, and then the situations in which accepting only cash could be best.

Benefits of Accepting Credit Cards

Most shoppers today count on businesses to accept credit and debit cards for all of their everyday purchases. From a merchant standpoint, there are several benefits of accepting credit cards, including:

  • Attract More Customers. You can accept a wider variety of customers—and keep them coming back again and again—when you accept credit and debit cards at your business. When businesses today don’t accept credit card payments, they often run the risk of losing disgruntled customers to competitors who are set up for credit card processing

  • Easy Acceptance On the Go. With today’s mobile payments technology, you can accept all the major credit card types right from your smartphone or tablet, wherever a WiFi or cellular data connection is available. Instead of having to keep track of a cash box and calculator while you’re selling your wares at a farmer’s market or music festival, for example, you’ll just need your smartphone and payments dongle (or other similar device).
  • Don’t Have to Keep Track of Paper Currency and Coins. When you process credit cards, your work at closing time is also radically simplified. You’ll have quick access to a report showing all your sales for the day. No need to fumble through counting paper money or coins, or having to swing by the bank to make a deposit each day.

When Cash May be Best

In the vast majority of cases, the benefits of accepting credit card payments will make any setup time and fees worth your while. However, there are some cases in which accepting only cash may be the best choice for your business. For example, if you have a very low transaction volume and limited sales, you may be better off accepting cash only. If you don’t make a lot of sales, the monthly and per-transaction fees may be relatively too high for your sales to offset these costs. Another example of when you may consider accepting cash only is if you’re in an industry—or sell to a targeted demographic—that has been historically established as “cash only,” and your patrons do not expect you to accept credit cards.

If you’re considering accepting only cash at your business, carefully weigh the pros and cons of doing so. Check out this helpful article from the U.S. Small Business Association for more information.

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