As this post is being written, the population of the United States sits at about 325.7 million people, which means that nearly 30 million people don’t carry a single dollar on their person. For the 55 percent of small businesses that are cash-based, this number should be alarming -- that’s a big number of potential customers to miss out on! Making the leap from a cash-only system to accepting credit cards can be daunting (and expensive), but the benefits far outweigh the costs. Here are a few reasons why cash-based business should consider accepting card payments.
There are over 27 million small businesses in the United States, yet 55% of them do not accept credit cards. As consumers rapidly move away from cash, businesses that don’t adapt to this shift are at risk of falling behind. In fact, a 2014 report by the Washington Post revealed that nearly 50% of Americans carry less than $20 in cash, and 9% carry no cash at all. This means that about 30 million people don’t have a single dollar on them—a huge potential market that cash-only businesses are missing out on. Transitioning from cash to card payments can seem daunting, but the benefits far outweigh the costs. In this guide, we’ll explore why cash-based businesses should start accepting card payments in 2024, backed by data and research.
As of 2024, the reliance on cash for transactions continues to dwindle. Consumers now prioritize convenience, speed, and security in their payment methods, with a marked preference for cards and contactless payments. According to recent data, card transactions accounted for 60% of retail payments in the U.S., leaving cash with a small fraction of the market share.
Consumers are evolving, and businesses must keep up. Those that don't accept cards are likely to lose customers who value flexibility and speed.
The most significant benefit of accepting cards is the potential to increase sales. Consumers tend to spend more when using cards compared to cash. Not being limited by the amount of cash they carry, cardholders are more likely to make impulse purchases or buy higher-ticket items.
Real-World Example: A retail store in California transitioned from a cash-only system to card payments and saw a 22% increase in revenue within six months. The store owner reported that customers made larger purchases, and new customers were attracted simply by the convenience of card acceptance.
Why It Matters: Accepting cards not only increases sales but also creates a better shopping experience, which keeps customers coming back.
Customers value convenience above all else. If given the option, many prefer to pay by card due to the speed and ease of the transaction. Whether in-store or online, the ability to accept card payments can make or break a sale.
An article published by Forbes in 2013 revealed that 66% of point-of-sale transactions involved a credit card, while only 27% involved cash. Over time, this gap has widened, with even fewer consumers opting to pay with cash.
Why It Matters: A seamless payment process enhances the customer experience, making it more likely that customers will return to your business.
Handling cash exposes businesses to theft and fraud. While credit card transactions carry their own risks, they are far easier to track and resolve in case of fraud. With modern technology like encryption and tokenization, card payments come with built-in security features that cash doesn’t offer.
As the U.S. Small Business Administration reports, businesses that adopt card payments reduce theft incidents by up to 30%, as the traceability of digital transactions acts as a deterrent to criminal activity.
Why It Matters: Card payments offer better protection for both the business and the customer, reducing the risk of fraud and theft.
Running a cash-only business requires manual reconciliation, accounting for errors, and dealing with cash shortages. Card payments, on the other hand, offer streamlined operational efficiency by automating much of the financial process.
For example, an Atlanta-based food truck switched to card payments and found that accounting became easier and more accurate, allowing the owner to focus on business growth rather than paperwork.
Why It Matters: Card payments save time and reduce errors, making daily operations more efficient.
One of the main reasons businesses hesitate to accept cards is the cost. While it’s true that accepting cards comes with expenses—such as hardware costs, monthly fees, and interchange rates—the return on investment is often greater than the costs.
SwipeSum, for example, works to minimize these costs. By connecting businesses with the best processing rates, SwipeSum ensures that no company feels burdened by hidden fees or high costs. Through its free online consultation, SwipeSum helps businesses find the best rates available, often saving them significant amounts of money.
While these costs are real, the increase in customer convenience, sales volume, and operational efficiency far outweighs them. “You need to spend money to make money,” as the old saying goes, and in this case, accepting cards can lead to significant growth.
Why It Matters: The cost of accepting cards is outweighed by the benefits. With the right payment processor, such as SwipeSum, businesses can minimize costs and maximize profits.
In some U.S. states, new regulations require businesses to accept card or digital payments to promote financial inclusion. For example, cities like New York and San Francisco have passed laws penalizing businesses that refuse card payments, ensuring that customers have more flexible payment options.
Why It Matters: Complying with evolving payment regulations is critical to avoid fines and ensure smooth business operations in 2024.
For businesses ready to start accepting card payments, choosing the right processor is crucial. Swipesum simplifies this process. By helping businesses find the most cost-effective solutions, Swipesum removes the guesswork and frustration often associated with the payments industry.
Whether you're a one-person operation or a multinational corporation, SwipeSum can help you save money and increase efficiency when accepting cards.
In 2024, cash-based businesses can no longer afford to ignore the benefits of accepting card payments. From increased sales and better customer experiences to improved security and operational efficiency, the advantages are clear. And with partners like SwipeSum offering affordable solutions, the transition is easier than ever. Don’t miss out on potential revenue—start accepting card payments today and position your business for long-term success.
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Taft Anderson
Taft Anderson is the former Product Marketing Manager of Swipesum. A graduate of Washington University in St. Louis' Olin Business School, Taft is a content and branding expert.
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