Businesses of all kinds are under an immense amount of pressure to accept credit cards from their customers. This, in itself, raises a question – can your business afford the costs associated with accepting credit card payments? A second question quickly following includes – can your business afford to lose customers due to not accepting credit card payments?
Today it’s rare to come across a business that doesn’t accept credit cards. Those businesses not staying on top of this technology appear out of touch and behind the times. Moreover, they risk losing business.
A recent report by bankrate.com found that around 80% of people carry less than $50 in cash while a substantial 9% routinely do not carry cash with them at all. That’s almost one in ten customers who will be out of reach if you don’t have a facility to accept credit card payments.
One hurdle you must face when accepting card payments is the range of fees associated with the platform. Given your goal is to be as profitable as possible, the additional costs can look burdensome at first glance. So what are your options?
You’re a small business set up to deal with small transactions. Accepting credit cards is too complicated and represents a cost to your business. This makes things simpler from your perspective, and you’ll keep all the money you receive from your customers. On the downside, you’ll lose business from those not carrying cash.
Pass the Cost
If you’ve ever paid bills online via credit card, there’s a good chance you might have run into the term convenience fees. This is, in effect, a way to pass the cost of accepting a credit card from a business to a consumer. Equally, some companies place a small surcharge on goods purchased with a credit card. For example, they may say that any goods purchased for less than $10 will be subject to a fee. This is because they have decided the size of the transaction is insufficient to justify credit card cost.
Many businesses pay more for payment processing because they don’t shop around. Different providers implement cost structures to card processing. These fees vary partially on the industry your business finds itself in. So if you are a high-risk business, exercise a little selectivity in your payment processor to get a better deal.
The decision you ultimately make will depend on a simple calculation – is the cost of accepting card payments more or less than the business lost through not accepting credit cards? If you come to find to need a card acceptance solution – give Payment Savvy a call. Payment experts since 2010, we offer a wide range of innovative, secure, and affordable payment solutions for businesses of all sizes.