PSA: Maybe stop pushing contactless payments on small businesses

I was at a local coffee shop in Portland last week and overheard the owner telling a customer they'd have to run a $2.50 coffee as $5 minimum because their card reader fees were eating into everything. Everyone keeps saying go fully contactless and ditch cash, but nobody talks about how those processing fees hit small shops like a truck. For a place moving maybe 200 transactions a day, even at 2.5% that adds up to hundreds a month they could keep. I run a small repair shop and switched back to taking more cash last year after realizing I lost $600 in fees over three months. Has anyone else done the math on what you actually give up with card only setups?

2 comments

2 Comments

elizabethtaylor5d agoRising Star

The trick is to do a hybrid system where you push cash for small ticket items. I started offering a 25 cent discount on drinks under $5 if paid in cash and it changed everything. People are way more likely to dig out a few bills when they see they save something. For bigger purchases over $50 I still run cards because the fee percentage is less painful. Have you tried giving cash customers a small break like that?

dianas505d ago

I read somewhere that some places actually save more by eating the processing fees on bigger purchases and just giving a flat cash discount on everything under $20, something about how the math works out differently depending on your average ticket size. Worth running your own numbers though, what works for one spot might not for another.