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Is Not Accepting Credit Cards Hurting Your Bottom Line?

May 7, 2021

You might be worried about accepting credit cards at your business. You could have concerns surrounding how much it costs to purchase the equipment necessary for reading these cards. The fees for each transaction may also be a problem. You might not be comfortable with spending a percentage of each card transaction on handling the work.

Maybe your business is a cash-only entity by design. There are many cash-only businesses and operators, like food trucks, laundromats, and nail salons. People who provide at-home services like dog-walking or babysitting may also operate on a cash-only basis.

But you might be leaving out a significant number of customers if you don’t accept credit cards. Accepting these cards can be a worthwhile investment, as they can increase your potential to make more money and bring in more customers.

Why Aren’t You Accepting These Cards?

You could have plenty of legitimate reasons why you aren’t accepting credit card payments:

  • Your business platform might be one that doesn’t manage credit cards.
  • You might live in an area where online connections are poor. It is often tough for people in rural areas to get reliable online signals.
  • Maybe you want to simplify your accounting efforts. It is easier to review your account details through cash accounting. You’re only reviewing the cash that comes in and out of your business here.
  • You might want to wait to collect the funds you require. Credit card payments have to be held in a merchant account before you can get it ready for use elsewhere.
  • There’s also the chance you might be hesitant in accepting cards. Your business might have been around long enough to where you aren’t all that concerned about accepting credit card payments. You might figure there’s no more of a need for you to accept these cards.

These are understandable reasons, but the problem is that people want choices when paying for things. They appreciate how credit cards can help them pay for things in moments. Not accepting these cards can be a risk if you aren’t cautious enough over what you manage.

The General Risks of Not Accepting Cards

The issues that come with not accepting cards are plentiful:

  • You may develop a negative reputation among others if you don’t accept credit cards. People might not see you as being overly reliant.
  • There could be suspicion among some people surrounding your business efforts if you run a cash-only business. Many companies might fabricate their earnings for tax purposes if they don’t accept cards.
  • People are becoming more in tune with digital payment solutions. These include Apple Pay, Google Pay, and other systems that link with credit cards. Failing to accept these choices could cause you to lose customers.
  • People who earn more money are more likely to use cashless transactions. You could earn more money if you accept cards, as you’re targeting people who are more likely to afford whatever you’re selling.
  • It will be harder to issue refunds to your customers if you run a cash-only business. It is easier to provide refunds through credit card deals, as you can trace a customer’s transaction and refund it from there.
  • Customers expect businesses to be up-to-date when handling various technologies. A company that doesn’t accept credit cards might be interpreted as being behind the times and unable to process deals.

Is It Possible To Spend Less When Accepting Credit Cards?

Accepting credit cards is one of the best things you can do when running a business. By accepting these cards, you let people know that you have a full infrastructure where you can support whatever transactions people wish to manage. But you can also establish a few policies surrounding what you support when getting these cards ready for use in any case.

You can utilize a few points to help you accept credit cards while spending less than you might expect:

  • You can select the specific cards you wish to accept. You could decline to accept American Express cards if you cannot afford the higher-than-average interchange fees Amex charges. Most customers use Visa and MasterCard credit and debit cards, so sticking with those two choices will be necessary.
  • You can establish a $10 minimum on card purchases. The minimum encourages people to use cash when they aren’t buying too many things. It also reduces the risk of people trying to use counterfeit bills when handling high-value cash payments.
  • There are many small POS systems you can utilize if you aren’t willing to commit to a full-size platform. Companies like Square and Clover have various POS solutions that fit everyone’s needs.
  • You can also incorporate online-only credit card processing systems in your work. PayPal is one of the top online-only options you can incorporate in your work, especially if you do much of your business online.
  • Be sure to check the terms surrounding each credit card processing provider on the market. All parties have unique rules for operation and different rates and fee schedules. You can compare options to find a solution that fits your budget.
  • There’s an option to add a fee to your purchases to offset any interchange fees you will spend on a deal. Be sure the move is closely integrated with your orders and that you don’t charge more than necessary to cover the total.
  • You could also produce a policy where you only offer store credit if you have to give a refund to a customer. The policy can reduce the risk of chargebacks. You can use this if you have a high percentage of return at your business.

Remember that credit card payments are critical to your business’ success. Failing to accept these payments will keep you from earning more money. You could also hurt your reputation if you don’t accept these payments. But by doing your research and coming up with a plan, you’ll have an easier time accepting credit card payments without spending more than you can afford.

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