It Pays to Offer More Ways to Pay

Has this ever happened to you? You decide to try out a cozy new breakfast nook or to stop into a quaint little store. As you’re about to pay your bill or make a purchase, you reach for your wallet. Just as you pull out your trusted debit or credit card, the cashier stops you and says, “I’m sorry, we don’t take cards. We only accept cash.”

If you’re a card-carrying member of the highly popular electronic payment club, you may be thinking you’ve just entered an episode of the Twilight Zone.

Who doesn’t accept credit or debit cards today? Churches, doctors, even the school lunch lady now accept these types of payments. In fact, in 2013, purchases made with debit, credit, and prepaid cards topped $4 trillion, and were projected to increase even more in 2015.

Yet despite the popularity and growth in credit and debit card usage, many smaller businesses still don’t offer the flexibility to pay by card. These businesses see merchant card processing as an added expense. Why turn over a portion of sales revenue to a credit card processor when they can keep 100% by accepting cash only?

What these merchants may not realize is that by accepting card payments, they can actually generate additional revenue. There are significant benefits to giving customers the benefit of paying by card, including:

  • Increased sales. Research has shown that consumers spend an average of 20% more when they pay by card versus cash or check.
  • Improved cash flow. Businesses that accept cards have improved cash flow, since they don’t have to wait for funds to clear as they would with a check.
  • Access to more customers. By accepting all payment forms, merchants are likely to attract more customers and not turn away those who prefer to pay by card. They may also be able to reach customers outside their geographic area through telephone or Web sales.
  • Increased customer loyalty. Customers who accept debit and credit card    payments may also accept gift cards, which increase repeat business and customer loyalty.

The bottom line is that accepting credit and debit cards helps merchants build the bottom line – and open more doors. And that is exactly what the owners of that cozy little breakfast nook and quaint gift shop want.


Vince Liuzzi serves as Executive Vice President and Chief Banking Officer at DNB First. 

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