Cash is definitely handy but not when your customer has a better and a more convenient option of payment. Walk in to any retail store and you will see that most customers prefer paying by credit/debit card. So what does that mean? Losing customers to the competitors and tedious paperwork are some major problems ‘cash only’ businesses face. Here are some more to help you understand that what it is like to accept only cash and the profitable advantages of accepting debit/credit from customers.
Disadvantages of ‘ Cash Only’ businesses
Limiting Business Growth
Most customers prefer using cards as a convenient method of payment. If you have tagged your business as ‘cash only’ you are sure to lose most of your customers including potential ones, to the competitor who accepts ATM cards. Most people use debit /credit for their daily purchases and cash is a secondary option or is used only during emergency situations. You are limiting your business growth if you make it difficult for those majority of people who prefer paying by credit card most of the times.
Losing Heavy Buyers
Not accepting cards is also a problem for those businesses that sell large items or one time investment products and limit themselves to accept only cash for payment. Most consumers who buy these large items pay through credit card, which is safer way of transferring cash than carrying the money in hand. Businesses selling large items lose their customers who are willing to pay the big price, but are denied purchase due to the company’s policy of not of credit cards. This system may incur heavy loses for businesses who sell these goods as their daily bread and butter.
More Chances of Fraud
A merchant that does not use the electronic system of accepting payments is open to allow frauds in his business. Keeping a large amount of money is an alluring spot for robbers. Also, a merchant will rarely get to know that the cash is missing when he depends on his employees to collect money on the counter. It is difficult to maintain a check and balance system for cash funds and counterfeit the cashier’s records under the cash only model. Using credit card processing machines automates business transactions and gives clear evidence of all records.
Tedious Paper Work
Receiving cash immediately for any business transaction is fast and convenient. What follows suit is the burdensome and endless paper work that may take considerable time. You need to record all transactions on paper and spend a large amount of time and money to convert this from physical work to automated records. Calculating cash, error free recording and safe storage is challenging. The most disappointing moment is when you lose all your records in a mishap.
Advantages of accepting credit card
Boost Sales – Most customers use ATM cards as this eliminates the need of carrying cash. Advance technology facilitates the use of ATM cards on smart phones for cashless transactions. Accepting credits can help businesses retain customers; attract more buyers that pay only by card hence boost sales.
Safe Transactions – ATM merchant services provide quick solutions to ensure safe credit card processing for all businesses. Instead of risking your business by keeping a large amount of money in your store it is safer to accept cards that are processed through secured software system.
Quick Services – Accepting cash is surely quicker, but not when your fall prey to fraudulent acts of fake currency or are unable to match records with the actual cash in hand. With the credit cards processors you receive funds within 24 hours from the time of transaction in the most secured manner. Accepting credit card also makes it convenient for customers to make quick payment especially if it’s an item of big purchase.
Flexible transactions – By accepting ATM cards you give an option to customers to make payments by cash or card. If you’re processing machine fails by any chance, your customers still have an option to use ATM services nearby your store and pay by cash. With the a credit card facility you can also expand business online and give a viable payment option to customers spread far and wide.