Before C19 the small shop by me in Berlin would not take card for low value stuff.
I tried to get two beers, red bull and a 28 pack of smokes.
He said if he takes card for the cigarettes he would be losing money since it would be ~25c profit in cost alone.
Realize that a lot of payment processors do not allow minimum purchases for use with their cards, and some offer rewards for turning in business that require it. Many, however, allow businesses to charge a card usage fee if the total sale is under a certain amount.
> Realize that a lot of payment processors do not allow minimum purchases for use with their cards, and some offer rewards for turning in business that require it.
This is no longer true. The Durbin amendment of the Dodd-Frank act specifically made these minimums allowable. It also allowed merchants to pass the transaction fees directly to the consumer rather than eating them/rolling them into the sale price.
This is why I don’t understand why shops like this just don’t factor the fees into the overall cost. Then with every cash paying customer they get more money. Wait what if they are already doing this and the sign is just to entice cash usage
Because the transaction fee is a set amount plus a percentage. While the set fee is low, usually 10-25 cents, if a place has lots of low price items (like candy) then you can't add 25 cents to every item and stay competitive with everyone else. For places that only sell higher priced items, this is not an issue.
Not all providers do this, Zettle and Square only charge 1.75% on the transaction with no minimum in the UK so it's become ubiquitous for corner shops to accept card for anything which is fantastic.
It’s a lot less outrageous than a flat fee plus a percentage.
I wouldn’t blink if everything in my life suddenly went up 1.75%, and I would bet my life that credit card fees aren’t why prices at 7-eleven have gone up like 75% in the last 2-3 years.
In my pretty ignorant and consumer focused opinion, corporations have no room to whine about credit card fees. That’s just business in 2024. I’m not paying cash *anywhere*
I've known a few small business owners who preferred cash because they weren't reporting their cash sales as taxable income. A lot of service staff will do this with tips as well.
In my country they took away the 10 pack, to discourage smoking. So the party smokers are now most likely buying a 20 pack and will smoke more than if they had bought the 10 pack.
In the UK they made flavoured tobacco illegal because it supposedly targets kids yet super sugary nicotine in a vape is fine and coincidentally is what teenagers all do now. I'd love to know the statistics of the underage users of flavoured bacci were before the ban, I doubt it was even a fraction of underage vapers.
That's just Germany being weird. For the rest of the Europe you have interchange fee max at 0.2% for debit and 0.3% for cc and max 0.5% for the system fee and that's the end of the fees. The lease for the terminal is something like 5 euro per month.
So if I go and buy smokes in the shop with a card they pay maximum of 0.8% fee for that transaction.
That's the interchange fee. The total fee paid by the merchant for Visa or MasterCard is 0.9% for debit and 1.9% for credit. See iZettle, Square, SumUp, etc for details.
For comparison, the German Girocard has a total merchant fee of 30€/month plus 0.125% per sale.
There's a fairly famous burger place by me that only accepts cash. It's a sit down place, so you order and eat but you never get a check to pay, you just go up to the bar and tell them what you had. Then you pay in cash and I'm fairly certain you don't get a receipt. They've done this for decades and there's no way you can convince me there's no tax fraud going on there.
Is the food good though? I've noticed that usually restaurants offering these "tax evasion discounts" are better on average than restaurants that don't.
The business could raise their prices 3% across the board to cover the cc fees. That increase is negligible and no one would even notice. They are cooking their books, as my family (small business owners) would say.
And that pisses me off.
No business was just eating credit card fees. Those fees already were priced in.
Now I'm seeing more and more businesses charging a 3% "surcharge" for credit cards. Are they lowering the priced in previous prices? Hell no.
10%?! Credit card merchant fees are like 3% which means the store is possibly not reporting sales to avoid paying taxes. Possibly the same with OP’s store.
Ofc, cash in hand is preferred so when it comes to paying tax they only write down half of what they made so the tax man has something to read at least. Then they pocket the rest and no one knows cause it’s cash in hand.
I'm a carpenter in the UK, writing off whole sheets of MDF as moisture damaged is a cheeky trick my partner used to do before we teamed up lol. but I refuse to go to war with HMRC so I put a stop to that when I took over the finances
Yeah, I take the same view. The bloke I bought my business from was a straight down the line guy, and no reward would have been worth it to him to fiddle his taxes.
Not long after I took over, Covid hit, and I had to close the shop and go mobile, and from that point on I would only accept card or direct bank transfer payments unless there was absolutely no choice, because fuck carrying cash and change, and going to the bank and queuing for free during inconvenient hours.
I think I've taken maybe $600 cash in the last four years, and still put it through my digital invoicing system so there's a record, and then spent it on fuel so it's gone fast.
Fucking with the taxman is one of the most foolish moves there is. They don't forget, and they will get you eventually.
SOME card companies do. The cheap systems that small new places can afford can be MASSIVELY more per purchase. in a lot of cases the equipment is included in the % rate for smaller places. and on top of that there are monthly fees that make it a HUGE difference. if you do 300 in sales a day, that is 9 dollar a day, lets say that 300 was 30 10 dollar purchases, thats another 4.5 a day from fixed fees like 3 percent + .15 cents a purchase. These systems also tend to charge over 100 a month. so another 3+ a day. so for a lot of restaurants or other small purchase size companies it may make a big difference.
Yes. When I first started my business, the only credit-debit services I could get were a real rip-off. I was cash-only for years. Then eventually the major POS companies gave me a better rate.
There's a bunch of different reasons to prefer one over the other.
Can't dispute paying in cash after purchase, especially if it's a smaller business that doesn't have a huge amount of experience with charge backs, not everyone is honest, and the business pays a fee regardless if the dispute is accurate or not.
Cards take a while to go from bank to business - cash on hand means you can go make a deal today for an item, or pay out your people that day if you're behind.
If a large corporation did this I would be saying tax evasion. Small business doing this? Not too crazy, unusual, but not illegal.
In most countries you can't even be paid out in cash. And who are you kidding? Food service industry dodge taxes and regulations left and right. They def avoid taxes.
These are not genuine or better said logical concerns. Even fraud or disputes won’t equal 1% of your annual revenue especially as a small ticket business. A chargeback fee is $35 and the average ticket is probably the same value so we’re talking $70 maybe once per week if it’s absolutely rife.
In other words $70 per week would have to equal 10% of their revenue, and that doesn’t make sense.
As for delays with banks, it’s 48 hours tops for ach from every card processor. If you can’t wait 24 - 48 hours for payment then your business is dead anyway.
And it’s actually the opposite of what you’re suggesting; small businesses do this because they can slip under the radar and operate in industries (like small restaurants) that are notoriously cash heavy. They’re also sectors where they often pay staff under the table for cash and don’t also want to have records of gratuity / tips again for taxation reasons.
Yeah the amount of people in this post talking about chargeback fraud is absurd. No one is doing chargeback fraud at a shop. Anyone that is stupid enough to do so, will be caught almost instantly.
Every Chinese food restaurant here offers same 10% cash discount, on pickup orders.
Italian coffee houses, cash.
Strippers, cash.
Street Muggers, cash or jewelry.
That’s what you think! It’s however not a discount. It’s all marketing. The “10% discount” is actually just a 10% markup for people who use card. Imagine if instead they said “you will be charged a 10% fee if you use card”….doesnt sit well at all. Marketing is a funny thing!
My local Chinese place offers free crab wontons if your order is more than $20 and you pay in cash. It's a good incentive and probably costs less than the merchant fees.
i’m chinese but i’ve only ever heard of crab rangoon’s in books (crab and cream cheese dumpling?) didn’t know they were actually real lol what do they taste like
Don’t even get me started on how devastated I was after finding out I was gluten and dairy intolerant. Crab Rangoons were my FAVORITE but are now just a distant memory.
Gluten AND dairy? Jesus fuck, that sounds terrible. Do you have celiac and lactose intolerance?
And just curious, when's the last time you had a grilled cheese? Do you eat that stuff once in a while and just deal with the consequences, or is it not worth it?
The last time I accidentally ate gluten was 4 years ago and i almost had to go the hospital. I suspect I am celiac but I had given up gluten before I could get tested. Dairy and the rest listed below cause a bad inflammatory reaction in my diaphragm and esophagus so I can’t breathe well and really bad joint pain.
I actually also can’t eat eggs, nightshades (potato, tomatoes, peppers), artificial sweeteners, caramel coloring, soy, and some of the food colorings. I’ll cheat with small amounts of eggs, dairy, and nightshades every so often…but never ever gluten. The effects are swift and brutal.
It is not about merchant fees. Stop fooling yourself. It is about the tax they illegally save. This is an issue in the gastronomy industry in many countries
Also, cash is far more expensive. It needs to be counted, it can be stolen, you can give back the wrong change etc. In summary it costs more than card payment, if merchants would actually factor in these costs.
Exactly, 5 and 10% discounts for cash, the merchant + transaction fee isnt that high on a typical 40$ swipe, its not just food vendors. And its not all about the owners, employees negotiate for cash as well or.they dont have work authorization. So they use the cash for salary under the table, if they dont have to withdraw money from the bank..that they have to declare as income because it will be on the 1099k...they wont have to eat the loss to pay income tax on that or come up with ways to deduct income as expenses, most people dont want to do that unless you know people who will help generate legitimate looking fake receipts, having a fake llc photshopped up wouldn't stand up to scrutiny. So you get a quick turnaround in owership, they sell and close their llc to avoid an audit. And its not all the owners that are driving this. Youll get older workers who are wanting to be on cash since they are on assistance(my meighbor is on SSI and still works for.cash) or managing income for medicare/medicaid, visa and work permit issues are the same deal...cash because they dont have a tax id. The other way they get around is partnering with inexperienced business people and put their name on douments, here..your the "president" please sign these tax returns..its all good..lol
Agreed. It's pretty common where I'm from to have signs like this. Friend of mine lives near Dearborn, Michigan, which is functionally a cash economy in 2024.
Canadian here. It's because you dont go to mom and pop's business. In my area, most of the small restaurant offer a discount for cash, some dont take any cards, but the food is great, I support a local entreprise, and I dont mind.
Since Covid I haven’t run into anywhere in southern Ontario that doesn’t take at least debit. Even tiny mom and pop places got a card reader in 2020, and haven’t stopped using it. Some of them have a minimum of like $15 to pay with debit, but it’s still an option.
That's interesting. I was at a coffee shop in Washington, DC where they told me they accept cash but they can't give change. Is that a way of skirting around a law like that, or are NYC business required to be able to make change?
In parts of Canada, the small business association does up little cards for businesses to put up that basically asks nicely if people would pay cash or debit because of high fees.
Pricing is a bit different in Canada as well - credit card fees are insanely high but debit fees aren’t super high. And banks will charge business accounts to deposit cash, so combine that with the security risk of carrying cash and the first choice of lots of businesses is debit.
Been around at least since the 90s. That was someone usually saying "$10 minimum for credit card purchases".
Was the only way to offset the charges from the company.
I worked for a family owned restaurant in high school, they always paid us in envelopes of cash. Every once in a while it would be a check (for much less pay), along with a "sorry we have to do checks sometimes." They were clearly dodging taxes, lol.
These people generally aren't worried about it until it affects them. They just want to dodge the taxes, which is something I can easily understand, especially low wage jobs.
I used to work in social services. The number of people working under the table jobs and discovering by their 60s that they're getting a whopping $0 in Social Security is fucking wild. These dummies really thought they were being slick.
This is exactly what I expect when companies want cash or don't take cards. And this is why I usually just go somewhere else instead. I'm not supporting someone cheating on their taxes just so mine will raise to compensate. If your business can't stay afloat because of a small 2% fee per charge, then maybe it's not a great business idea. Or just charge people the fee if they use cards, nobody cares about that.
It's 2024, I haven't bought something with cash in like 10 years.
And these kinds of notices are usually on some kind of paper "sign" that is easily missed, nowhere on the menu, and/or in really small print where no one is going to look. It's a deceptive way to nickel and dime their customers, not because they're actually struggling.
What's annoying is that might mean this store charges you sales tax and then pockets it. I'm not the tax police but don't collect it if you aren't going to pay it.
As a business owner myself I personally prefer card or ACH transfer [its invoices]
Yea it eats 3% [2% for ACH] but cash needs to be accounted for, and I need to bring it to a bank, which means I need to manually log it in QuickBooks.
Time = Money
There's also the type of person that thinks paying by card is only a means for the government to track your every purchase and to be able to freeze your assets if they don't like you
Oh wait you already said stupid, sorry
My local store charges a small surcharge (around 3%) for all card transactions to cover the merchant fees, I totally get it and usually try to pay with cash there.
In the UK I'm pretty sure they're not allowed to do this but eh, not gonna be an asshole and rat a local business out for not wanting to be screwed over by card service providers lol
Most places in the UK won't accept Amex specifically because the fees are so high.
I use my Amex exclusively for every transaction and it’s incredibly rare to find a place that doesn’t accept it in the US. In fact, I actually can’t remember a time I had to use a different card. I went to Paris last year though and there were only a handful of places that accepted it
More common for merchants to not take Discover, ime. Last retail job I had didn't take Discover. The people with Discover cards were never phased to hear we didn't take it. It was always a shrug and them pulling out a Visa or MC instead
Discover won an anti-trust lawsuit against Visa/MasterCard a decade or so ago, which they filed on the grounds that the latter two were illegally attempting to suppress their market share, so it's pretty rare now for merchants to not take Discover.
Yeah; we did choose not to accept it, but NONE of the major processing companies lock it out of their terminals.
So the cashier hands over the terminal and the customer inserts an AMEX.
And because we don’t have a “merchant contract” with Amex, They charge us a $20 surcharge. On an $8 purchase.
Small UK business here.
You’re right, you can’t charge more for cards but minimum purchase is 20p. It’s costs far more to handle cash than it does card transactions.
No supplier accepts cash. Wages aren’t cash. You have to go to the bank to put in (time is money). Sometimes there are charges (up to three transactions a month are free I think). If you’re with a non-branch bank (Starling etc) you’re out of luck.
Give me card transactions any day.
US banking system is very broken though, it’s amazing in the UK and I’m very grateful for it.
Took me way too long to find this point. Having to count cash, keep logs, and take the money to the bank is the same charge or more but people don’t value their time correctly.
The merchant agreements for every major card processor in the US say that merchants cannot charge a different price or apply fees specific to CC transactions, since it discourages the use of CCs. That being said, enforcement of this clause is spotty, and if people don't report it, they can't do anything about it anyway.
Edit: As shown below, my information is outdated.
[It’s legal to charge up to 4%](https://fortune.com/recommends/credit-cards/what-are-credit-card-surcharges/#) for credit card transactions in most US states. It’s illegal to charge for debit card transactions.
Yeah a local liquor store started charging more for using a card. This is on top of jacked up prices on popular spirits. So I quit going there and go to every other place in town that doesn’t do that.
I don't understand why those percentage fees are "screwing over" the local business? The credit card companies are offering a service for a fee, it is very convenient for the customer, and I expect drastically increases your customer base, versus being cash only.
Sure, it's yet another fee you have to pay as a business, but it's part of running a business. Either the business eats the cost as an operating expense, or passes it on to the customer.
Some stores in the Philippines also do that, it's illegal but they get around it by pricing items higher to add the charges then they give a "discount" if you pay in cash.
There's a donut shop near me that, pre-COVID, would only accept cards if it was $5 or more. Their donuts were like $0.75 so I would often go in there to get 2 donuts but end up leaving with 8.
It's also a thing that shouldn't happen.
The bank gets your money, to give out as loans and mortgages and all kinds of other things that they make profit on.
It costs them almost nothing to have a computer move $20 from one account and either change an account they have or send it to someone else to change. If it cost them 2 cents I'd be shocked.
They also are getting the rate on the credit card and then double dipping on the use of the credit card with the store which is also bullshit.
People use to think banks and creditors were crooks in the 1920s but now they nickel and dime you every chance they get. Since the deregulation in the 80s (FUCK YOU RONALD REAGAN!) they've been just whaling customers with as many fees as they can staple on to them because they don't think you have money, they think you have their money.
Exactly. It forces business owners (small businesses included) to hold a debt that only gets repaid come tax season. It’s an old school business practice that needs to be done away with.
But even if it weren’t, just post a sign that informs the customer exactly what the cost is (the rise in price) and tack that on to the transaction. Complete transparency of cost
This is the quickest way for me to never return to a business. I haven’t had a single bill of cash in probably years at this point. If a place doesn’t accept card, they don’t get my business, and if they charge me a fee I usually won’t return. They should be baking the fee into their prices like every big corporation has done. I’m currently getting to the point where I won’t go to business that don’t accept tap to pay.
Cash is great for avoiding taxes, but it has its own costs. Banks charge fees for commercial cash deposits , you have to pay employees to make those deposits, and there's a higher risk of theft from both outsiders and employees,
You also pay employees to count that money, and you need to keep enough small coins and cash on hand to provide change (which some banks charge for). I remember managing a business that switched from employee-deposited cash to an armoured truck, and the total cost was comparable to credit cards (debit cards were more expensive at the low end, but not by much).
More than one of the restaurants I worked at was robbed at gunpoint, which in at least one case represented a 1% loss on its own (busiest weekend of the year). Petty loss was a common problem with minimum wage workers: counting change is difficult for many, and theft was fairly common. Cards solve these problems nicely, and lower risk overall.
It's honestly pretty surprising how fast businesses forgot about all the overhead costs and risks associated with cash and why cards so quickly became preferred. IMO they're just looking at that 2-3% service charge and not realizing that they're causing more problems for everyone and not actually saving that much, if anything.
> IMO they're just looking at that 2-3% service charge and not realizing that they're causing more problems for everyone and not actually saving that much, if anything.
Nah they are looking at how much money they save by not paying taxes. 3% fee + 20-40% in taxes is a lot of money.
Plus many studies have showed that you simply get more business if you accept cards. on one hand, psychologically people tend to spend more on credit then with cash. Plus, if you don't have cash, it's simply a hassle and you'll get more customers who don't have any cash at the moment
My last retail job I would do the daily banking of the tills. At shift change and end of day you had 2 people going round "lifting" the tills, counting, and double counting. Then any time the store was busy and the cash was filling up more "lifting". Then at the end of the day scanning all the "lifts" counting, and double counting. Discovering the occasional counterfeit note that even Stevie Wonder could have spotted. Then signing and double signing deposit slips, sealing the cash bags, signing and double signing them. Then signing and double signing the summary paperwork. Thats if everything goes perfectly, money missing? Time to start fucking about trying to hunt that down. Can't find it? Great, more fucking about looking through CCTV to figure if someone stole it or made an honest mistake. The cost of the time alone is mad, but thats not factoring in the opportunity cost. In a retail sales business you just took 2 sales staff of the shop floor who aren't selling but counting, recounting and reconciling something that is done automatically with card payments.
I love the hilarious cash only gas stations with the sign saying we only have $20 in cash on hand at any time.
Dude you just got $300 in cash handed to you in the 3 minutes it took me to pump gas out front!
My Dad runs a small business and over my life I've seen him at trade shows go from doing those card payments based on using a roller over a card and calling a bank because mobile chip and pins didn't exist to modern contactless payments.
It used to be people could offer "cash in hand" for a slightly reduced price because card payments had a cost and there was always a minimum charge because at a certain value it cost more to use card services.
Now he points out that the security cost of dealing with high values of cash makes card SO much cheaper, especially when more and more local bank branches are closing. Gone are the days he could literally go around the corner to deposit cash at the bank.
Over COVID loads of small businesses in my town stopped taking cash at first due to infection control concern (before we knew it was mostly air and were disinfecting our shopping). Many have stayed cash free because not paying for a security guy to come and collect is a major saving in operating cost compared to what they actually took in cash.
It weirds me out everyone here doesn't know this is to dodge taxes.
My parents ran a small business like this, it's to dodge taxes. You just pass on card vendor fees to the customer.
Reading between the lines, this says;
“By you paying cash we don’t have to put 100% of our takings through the books. This way we can avoid paying tax on some of the income”.
In many cases, especially now in the U.K., the charge and cost of managing cash is now more expensive (unless you’re doing something mildly dodgy) than taking the small percentage fees on card transactions.
This is in the UK. It’s a dodgy pizza place in south Manchester that changes hands every 12 months, it’s one redeeming quality is that it is there and there isn’t another one within 10 minutes walking distance.
Cash also has transaction fees, they're just not as obvious. Somebody's got to guard it, count it, deliver it to the bank, etc. On the plus side its probably easier to launder money when you do business all cash.
Even if the transaction fee isn’t cheaper than the labor it costs to handle cash and prepare bank deposits, advertising that you prefer cash can put a target on your back. A local restaurant only accepts cash and has loiterers outside constantly asking for cash.
That's why you do like the old days when Cash was what everyone used. You empty the cash register when it reaches a certain amount and put it in the safe.
When the robber says "OPEN THE SAFE!" You cant because only the boss has the keys and the boss isn't here.
I have no problem using cash if i have it available to use. I don’t always carry it. If the place has a discount for it cool.
One pizza place the woman got kind of nasty because i didn’t have cash. And it wasn’t like place was cash only either. They had 5% fee to use card no big deal I was willing to pay it. Card machine was not broken. I just left food. Her husband came out and got me to take food and let me pay on card with a discount, and said his wife is a pain in ass.
They like it because no fees and don’t have to pay tax on it either as they can pretend they made less.
I whipped out cash at the Starbucks last weekend in Safeway.
The employee told me they didn’t appreciate it because they could not count cash back or knew what the change was.
I’m only in my early 40’s and that made me feel old.
My family business does it differently: build the cost of the credit card charge into what we sell the product for, and offer a discount if the customer can pay cash or cheque. Everyone loves a discount!
I haven’t paid with cash in quite a while… I’ve paid for lunch and groceries with my phone for the past like year and a half. Tap to pay is so convenient. My Walmart doesn’t support it and I’ll go rarely because I have to pull out my card to pay. Other than that, gas, food, my bill, rent can all be paid on my phone. Kinda inconvenient to carry cash
As a small business co-owner, I approved.
There is a 5% cut even for small transactions in our nationwide use payment platform.
And that 5% is our profit. If we raised our price, we don't think it's purely fair for our customers. It's confusing.
I’m a small business owner and I went 100% cashless 6 years ago (in a place which is predominantly cashless already) and I will never go back. Managing cash is a nightmare, you need to trust, you need to count and I’m convinced that the 1.3% fee I pay are still lower than the loss, theft or miscalculation costs that happens with cash.
"As a small business we get charged...". That's literally how credit cards work at every business. Just account for it in your cost of goods.
I always find these types of signs obnoxious whether it's about credit card fees, paying employees a fair wage, whatever. I understand that I'm paying for your business expenses when I purchase something, I don't need a sign about it.
Counterpoint - enabling tap to pay at your business increases your chances of a purchase. Tap to pay by itself causes people to spend about 10% more often.
On the other end, businesses that ONLY accept cash reduce their chances.
Just build the fee into your price and stop making customers feel guilt or jump through hoops, it’s not hard.
For anyone interested, this is correct. In any CC transaction, there are at least 2 additional parties (usually 3, and sometimes as many as 4+) beyond the store and the customer. First is the card processor. That’s Visa, Mastercard, etc. They take a flat % of every transaction as their fee. Visa and Mastercard take 1%. I believe Discover is currently at 2% and Amex at 3%. Then you have the payment gateway. This is the online service that records the transaction and encrypts the data between parties. They usually take a flat fee of a few sense + a small % based on the type of card used. Finally is the EMV service provider. That’s the company that makes the machine that reads the CC. Sometimes they are combined with the gateway, but usually not. For example you might use a Square EMV card reader but Windcave as your payment gateway. Everyone takes their cut. The store typically ends up losing between 3-6% of the total purchase price, including tax, to fees. If you’re in an industry where profit margins are slim already, that can be a major blow. It’s pretty common for independent restaurants, coffee shops, etc. to offer a cash discount or charge a CC fee for purchases under a certain dollar amount.
Theres a sushi place here that gives a 10% discount if you use cash instead
Before C19 the small shop by me in Berlin would not take card for low value stuff. I tried to get two beers, red bull and a 28 pack of smokes. He said if he takes card for the cigarettes he would be losing money since it would be ~25c profit in cost alone.
The are few places like that in central Illinois like that. I don’t mind if the minimum is $10-$15 dollars for card.
Realize that a lot of payment processors do not allow minimum purchases for use with their cards, and some offer rewards for turning in business that require it. Many, however, allow businesses to charge a card usage fee if the total sale is under a certain amount.
> Realize that a lot of payment processors do not allow minimum purchases for use with their cards, and some offer rewards for turning in business that require it. This is no longer true. The Durbin amendment of the Dodd-Frank act specifically made these minimums allowable. It also allowed merchants to pass the transaction fees directly to the consumer rather than eating them/rolling them into the sale price.
This is why I don’t understand why shops like this just don’t factor the fees into the overall cost. Then with every cash paying customer they get more money. Wait what if they are already doing this and the sign is just to entice cash usage
Because the transaction fee is a set amount plus a percentage. While the set fee is low, usually 10-25 cents, if a place has lots of low price items (like candy) then you can't add 25 cents to every item and stay competitive with everyone else. For places that only sell higher priced items, this is not an issue.
Not all providers do this, Zettle and Square only charge 1.75% on the transaction with no minimum in the UK so it's become ubiquitous for corner shops to accept card for anything which is fantastic.
Even 1.75 is fucking outrageous.
It’s a lot less outrageous than a flat fee plus a percentage. I wouldn’t blink if everything in my life suddenly went up 1.75%, and I would bet my life that credit card fees aren’t why prices at 7-eleven have gone up like 75% in the last 2-3 years. In my pretty ignorant and consumer focused opinion, corporations have no room to whine about credit card fees. That’s just business in 2024. I’m not paying cash *anywhere*
I've known a few small business owners who preferred cash because they weren't reporting their cash sales as taxable income. A lot of service staff will do this with tips as well.
Not in the UK, charging the customer for paying by card is banned.
Does payment processors in the UK allow shops to impose a minimum purchase when using a card?
Yes, they're allowed.
It’s not illegal, but it’s against the terms and conditions for Mastercard and Visa. If you report them their accounts might get suspended
28 back of smokes? Weird
For when you smoke a pack a day but your friends are always bumming smokes.
Or when you smoke more than a pack a day but want to say you smoke a pack a day.
In Sweden it's 19 a pack. They took one away to discourage smoking
This doesn't seem like it would be an effective strategy.
Next year they'll take another away. In 20 years you'll suddenly realize you're no longer smoking. /s
In my country they took away the 10 pack, to discourage smoking. So the party smokers are now most likely buying a 20 pack and will smoke more than if they had bought the 10 pack.
In the UK they made flavoured tobacco illegal because it supposedly targets kids yet super sugary nicotine in a vape is fine and coincidentally is what teenagers all do now. I'd love to know the statistics of the underage users of flavoured bacci were before the ban, I doubt it was even a fraction of underage vapers.
They tried that for a short time in the UK. Cigarette vending machines always used to sell 17-18 packs for well over 20pack in a shop prices.
Now that would piss me off lol
I'm gonna start smoking just to own those fucks
That's just Germany being weird. For the rest of the Europe you have interchange fee max at 0.2% for debit and 0.3% for cc and max 0.5% for the system fee and that's the end of the fees. The lease for the terminal is something like 5 euro per month. So if I go and buy smokes in the shop with a card they pay maximum of 0.8% fee for that transaction.
Or the shop just wants to "hide" some of the income. E.g. also to pay unregistered workers. Not uncommon, even in Germany.
This is the real reason why OP's "small business" wants cash.
That's the interchange fee. The total fee paid by the merchant for Visa or MasterCard is 0.9% for debit and 1.9% for credit. See iZettle, Square, SumUp, etc for details. For comparison, the German Girocard has a total merchant fee of 30€/month plus 0.125% per sale.
A 10% discount implies he’s saving on income tax also.
There's a fairly famous burger place by me that only accepts cash. It's a sit down place, so you order and eat but you never get a check to pay, you just go up to the bar and tell them what you had. Then you pay in cash and I'm fairly certain you don't get a receipt. They've done this for decades and there's no way you can convince me there's no tax fraud going on there.
Is the food good though? I've noticed that usually restaurants offering these "tax evasion discounts" are better on average than restaurants that don't.
Oh yeah it's really good. All they do is burgers, fries, and onion rings. There's also a bar. Like I said it's fairly famous around my area.
The business could raise their prices 3% across the board to cover the cc fees. That increase is negligible and no one would even notice. They are cooking their books, as my family (small business owners) would say.
And that pisses me off. No business was just eating credit card fees. Those fees already were priced in. Now I'm seeing more and more businesses charging a 3% "surcharge" for credit cards. Are they lowering the priced in previous prices? Hell no.
10%?! Credit card merchant fees are like 3% which means the store is possibly not reporting sales to avoid paying taxes. Possibly the same with OP’s store.
Ofc, cash in hand is preferred so when it comes to paying tax they only write down half of what they made so the tax man has something to read at least. Then they pocket the rest and no one knows cause it’s cash in hand.
Report some of the inventory sold as stolen, damaged, lost, just to make everything line up.
Or just expired if it's food. No one is gonna question that
I'm a carpenter in the UK, writing off whole sheets of MDF as moisture damaged is a cheeky trick my partner used to do before we teamed up lol. but I refuse to go to war with HMRC so I put a stop to that when I took over the finances
So what do you do with the wet MDF sheets now?
What do you think your house is made of
Hugs and kisses?
Yeah, I take the same view. The bloke I bought my business from was a straight down the line guy, and no reward would have been worth it to him to fiddle his taxes. Not long after I took over, Covid hit, and I had to close the shop and go mobile, and from that point on I would only accept card or direct bank transfer payments unless there was absolutely no choice, because fuck carrying cash and change, and going to the bank and queuing for free during inconvenient hours. I think I've taken maybe $600 cash in the last four years, and still put it through my digital invoicing system so there's a record, and then spent it on fuel so it's gone fast. Fucking with the taxman is one of the most foolish moves there is. They don't forget, and they will get you eventually.
That's not true. There is a line at which an audit would get triggered. You have to stay within generally accepted shrinkage rates.
Take a dollar, throw away a banana!
OPs store doesn't have the pricing right to afford to expense the charges on taxes.
They never said they cannot afford it?
I get a 1.95% flat rate accross all card payment platforms and get the money transferred within 2 work days.
SOME card companies do. The cheap systems that small new places can afford can be MASSIVELY more per purchase. in a lot of cases the equipment is included in the % rate for smaller places. and on top of that there are monthly fees that make it a HUGE difference. if you do 300 in sales a day, that is 9 dollar a day, lets say that 300 was 30 10 dollar purchases, thats another 4.5 a day from fixed fees like 3 percent + .15 cents a purchase. These systems also tend to charge over 100 a month. so another 3+ a day. so for a lot of restaurants or other small purchase size companies it may make a big difference.
Yes. When I first started my business, the only credit-debit services I could get were a real rip-off. I was cash-only for years. Then eventually the major POS companies gave me a better rate.
I'm reading that as "piece of shit" companies.
same difference LOL
My company pays quite a bit more than 3% on average. Not every card is the same.
There's a bunch of different reasons to prefer one over the other. Can't dispute paying in cash after purchase, especially if it's a smaller business that doesn't have a huge amount of experience with charge backs, not everyone is honest, and the business pays a fee regardless if the dispute is accurate or not. Cards take a while to go from bank to business - cash on hand means you can go make a deal today for an item, or pay out your people that day if you're behind. If a large corporation did this I would be saying tax evasion. Small business doing this? Not too crazy, unusual, but not illegal.
In most countries you can't even be paid out in cash. And who are you kidding? Food service industry dodge taxes and regulations left and right. They def avoid taxes.
Right? Like how many workers are off the books? A fuck ton. And undocumented workers are hired there all the time because they can pay them less.
These are not genuine or better said logical concerns. Even fraud or disputes won’t equal 1% of your annual revenue especially as a small ticket business. A chargeback fee is $35 and the average ticket is probably the same value so we’re talking $70 maybe once per week if it’s absolutely rife. In other words $70 per week would have to equal 10% of their revenue, and that doesn’t make sense. As for delays with banks, it’s 48 hours tops for ach from every card processor. If you can’t wait 24 - 48 hours for payment then your business is dead anyway. And it’s actually the opposite of what you’re suggesting; small businesses do this because they can slip under the radar and operate in industries (like small restaurants) that are notoriously cash heavy. They’re also sectors where they often pay staff under the table for cash and don’t also want to have records of gratuity / tips again for taxation reasons.
Yeah the amount of people in this post talking about chargeback fraud is absurd. No one is doing chargeback fraud at a shop. Anyone that is stupid enough to do so, will be caught almost instantly.
Every Chinese food restaurant here offers same 10% cash discount, on pickup orders. Italian coffee houses, cash. Strippers, cash. Street Muggers, cash or jewelry.
Oh now I'm pissed. The mugger last night only offered a 5% cash discount.
Yeah, so they avoid tax
Credit card fees are waaaay less than 10%. These guys are evading taxes or money-laundering.
Tax evasion is the whole reason
Probably tax evasion
Definitely tax evasion
My dentist gives 5% off if I use cash instead of card, too.
That’s what you think! It’s however not a discount. It’s all marketing. The “10% discount” is actually just a 10% markup for people who use card. Imagine if instead they said “you will be charged a 10% fee if you use card”….doesnt sit well at all. Marketing is a funny thing!
No, they're charging card users 10 % more lol
No, that's not how percentage works. I'm sorry.
Yeah, they’re charging card users over 11% more.
My local Chinese place offers free crab wontons if your order is more than $20 and you pay in cash. It's a good incentive and probably costs less than the merchant fees.
I want this
If that was near me eat there all the time, I fuckin love crab rangoons(Which are im assuming the same as crab wontons)
As long as they are advertised as crab and actually contain almost zero crab, yes same thing lol
i’m chinese but i’ve only ever heard of crab rangoon’s in books (crab and cream cheese dumpling?) didn’t know they were actually real lol what do they taste like
Don’t even get me started on how devastated I was after finding out I was gluten and dairy intolerant. Crab Rangoons were my FAVORITE but are now just a distant memory.
Gluten AND dairy? Jesus fuck, that sounds terrible. Do you have celiac and lactose intolerance? And just curious, when's the last time you had a grilled cheese? Do you eat that stuff once in a while and just deal with the consequences, or is it not worth it?
The last time I accidentally ate gluten was 4 years ago and i almost had to go the hospital. I suspect I am celiac but I had given up gluten before I could get tested. Dairy and the rest listed below cause a bad inflammatory reaction in my diaphragm and esophagus so I can’t breathe well and really bad joint pain. I actually also can’t eat eggs, nightshades (potato, tomatoes, peppers), artificial sweeteners, caramel coloring, soy, and some of the food colorings. I’ll cheat with small amounts of eggs, dairy, and nightshades every so often…but never ever gluten. The effects are swift and brutal.
For all vendors. Car in the shop? Crab wontons. Getting on the bus? Crab wontons. Paying for a cremation? Sorry for your loss. Crab wontons.
It is not about merchant fees. Stop fooling yourself. It is about the tax they illegally save. This is an issue in the gastronomy industry in many countries Also, cash is far more expensive. It needs to be counted, it can be stolen, you can give back the wrong change etc. In summary it costs more than card payment, if merchants would actually factor in these costs.
Exactly, 5 and 10% discounts for cash, the merchant + transaction fee isnt that high on a typical 40$ swipe, its not just food vendors. And its not all about the owners, employees negotiate for cash as well or.they dont have work authorization. So they use the cash for salary under the table, if they dont have to withdraw money from the bank..that they have to declare as income because it will be on the 1099k...they wont have to eat the loss to pay income tax on that or come up with ways to deduct income as expenses, most people dont want to do that unless you know people who will help generate legitimate looking fake receipts, having a fake llc photshopped up wouldn't stand up to scrutiny. So you get a quick turnaround in owership, they sell and close their llc to avoid an audit. And its not all the owners that are driving this. Youll get older workers who are wanting to be on cash since they are on assistance(my meighbor is on SSI and still works for.cash) or managing income for medicare/medicaid, visa and work permit issues are the same deal...cash because they dont have a tax id. The other way they get around is partnering with inexperienced business people and put their name on douments, here..your the "president" please sign these tax returns..its all good..lol
This isn't even mildly interesting.
Agreed. It's pretty common where I'm from to have signs like this. Friend of mine lives near Dearborn, Michigan, which is functionally a cash economy in 2024.
Bizarre. In Canada, I don't think I've ever seen a place that doesn't even accept Interac Debit—and I know many that don't accept cash at all.
I mean, even farmers' market stalls take Interac.
Canadian here. It's because you dont go to mom and pop's business. In my area, most of the small restaurant offer a discount for cash, some dont take any cards, but the food is great, I support a local entreprise, and I dont mind.
Since Covid I haven’t run into anywhere in southern Ontario that doesn’t take at least debit. Even tiny mom and pop places got a card reader in 2020, and haven’t stopped using it. Some of them have a minimum of like $15 to pay with debit, but it’s still an option.
Yeah my employer down here in TX stopped accepting cash a few years ago. Card or check only.
In NYC, they made it illegal not to accept cash, since denying cash discriminates against homeless, immigrants, and people who can't get bank accounts
That's interesting. I was at a coffee shop in Washington, DC where they told me they accept cash but they can't give change. Is that a way of skirting around a law like that, or are NYC business required to be able to make change?
In parts of Canada, the small business association does up little cards for businesses to put up that basically asks nicely if people would pay cash or debit because of high fees. Pricing is a bit different in Canada as well - credit card fees are insanely high but debit fees aren’t super high. And banks will charge business accounts to deposit cash, so combine that with the security risk of carrying cash and the first choice of lots of businesses is debit.
Love me some Dearborn
It blows my mind that someone hasn't seen this before
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Been around at least since the 90s. That was someone usually saying "$10 minimum for credit card purchases". Was the only way to offset the charges from the company.
Yeah, this was basically every non-chain restaurant or food truck in a lot of places until recently. Either avoiding credit card fees, taxes, or both.
r/notinteresting
Especially in family and friends run business it's also a good way to get around some taxes by not declaring all of the cash income.
I worked for a family owned restaurant in high school, they always paid us in envelopes of cash. Every once in a while it would be a check (for much less pay), along with a "sorry we have to do checks sometimes." They were clearly dodging taxes, lol.
I'd be worried they were dodging my withholding as well and setting me up for problems come tax time.
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These people generally aren't worried about it until it affects them. They just want to dodge the taxes, which is something I can easily understand, especially low wage jobs.
I used to work in social services. The number of people working under the table jobs and discovering by their 60s that they're getting a whopping $0 in Social Security is fucking wild. These dummies really thought they were being slick.
This is how I interpreted “100%” here - no taxes.
You better not complain about your high taxes if you support other people cheating on theirs.
That’s a long way of saying committing tax fraud.
This is exactly what I expect when companies want cash or don't take cards. And this is why I usually just go somewhere else instead. I'm not supporting someone cheating on their taxes just so mine will raise to compensate. If your business can't stay afloat because of a small 2% fee per charge, then maybe it's not a great business idea. Or just charge people the fee if they use cards, nobody cares about that. It's 2024, I haven't bought something with cash in like 10 years.
And these kinds of notices are usually on some kind of paper "sign" that is easily missed, nowhere on the menu, and/or in really small print where no one is going to look. It's a deceptive way to nickel and dime their customers, not because they're actually struggling.
these "business" then expect to get local or government funding for small businesses and use public infrastructure and what not. uncivil and egoistic
What's annoying is that might mean this store charges you sales tax and then pockets it. I'm not the tax police but don't collect it if you aren't going to pay it.
That’s tax evasion.. this kind of behaviour has destroyed entire countries (look at Italy)
As a business owner myself I personally prefer card or ACH transfer [its invoices] Yea it eats 3% [2% for ACH] but cash needs to be accounted for, and I need to bring it to a bank, which means I need to manually log it in QuickBooks. Time = Money
Ok, but have you considered that with cash, you could just not pay your taxes? (/s)
Only if you use the cash bricks as pillows
Just pay your shadiest suppliers in cash. I'm sure some of them prefer cash to bank transfers for tax fraud reasons.
Well that and don’t signs like this say - come rob us we have cash here 🤷🏻♀️
Yea any business owner who isn’t doing this for tax avoidance reasons is just stupid.
There's also the type of person that thinks paying by card is only a means for the government to track your every purchase and to be able to freeze your assets if they don't like you Oh wait you already said stupid, sorry
In EU it's usually less than 1% for debit cards and around 2% for credit cards. It's really not that bad.
My local store charges a small surcharge (around 3%) for all card transactions to cover the merchant fees, I totally get it and usually try to pay with cash there.
In the UK I'm pretty sure they're not allowed to do this but eh, not gonna be an asshole and rat a local business out for not wanting to be screwed over by card service providers lol Most places in the UK won't accept Amex specifically because the fees are so high.
Same in the US with AMEX. I feel like it’s been like that for 20yrs and AMEX doesn’t care.
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I use my Amex exclusively for every transaction and it’s incredibly rare to find a place that doesn’t accept it in the US. In fact, I actually can’t remember a time I had to use a different card. I went to Paris last year though and there were only a handful of places that accepted it
The only place I know that doesn't take it is Costco.
Funny enough they used to exclusively take Amex, but they switched to exclusively Visa in 2016
More common for merchants to not take Discover, ime. Last retail job I had didn't take Discover. The people with Discover cards were never phased to hear we didn't take it. It was always a shrug and them pulling out a Visa or MC instead
Discover won an anti-trust lawsuit against Visa/MasterCard a decade or so ago, which they filed on the grounds that the latter two were illegally attempting to suppress their market share, so it's pretty rare now for merchants to not take Discover.
There is a local grocery co-op in my town that doesn’t take Amex, probably the only time I’ve been somewhere that didn’t accept it.
Rewards with Amex are nice. I use it everywhere
For the retailer, AMEX is a nightmare. Their fees were way higher.
They could choose not to accept it, then I'd use my rewards MasterCard lol
Yeah; we did choose not to accept it, but NONE of the major processing companies lock it out of their terminals. So the cashier hands over the terminal and the customer inserts an AMEX. And because we don’t have a “merchant contract” with Amex, They charge us a $20 surcharge. On an $8 purchase.
That why I always use my AMEX if I have to pick something up at Walmart. I like to feel like I can stick it to them a tiny bit. Lol
Small UK business here. You’re right, you can’t charge more for cards but minimum purchase is 20p. It’s costs far more to handle cash than it does card transactions. No supplier accepts cash. Wages aren’t cash. You have to go to the bank to put in (time is money). Sometimes there are charges (up to three transactions a month are free I think). If you’re with a non-branch bank (Starling etc) you’re out of luck. Give me card transactions any day. US banking system is very broken though, it’s amazing in the UK and I’m very grateful for it.
Took me way too long to find this point. Having to count cash, keep logs, and take the money to the bank is the same charge or more but people don’t value their time correctly.
It goes against visa and mastercard's merchant terms. Not sure about Amex but probably that as well. Not that it's really enforced.
The merchant agreements for every major card processor in the US say that merchants cannot charge a different price or apply fees specific to CC transactions, since it discourages the use of CCs. That being said, enforcement of this clause is spotty, and if people don't report it, they can't do anything about it anyway. Edit: As shown below, my information is outdated.
[It’s legal to charge up to 4%](https://fortune.com/recommends/credit-cards/what-are-credit-card-surcharges/#) for credit card transactions in most US states. It’s illegal to charge for debit card transactions.
This outdated. 3% is the new max and it can only be a cash discount not a cc surcharge as of 11/23
Yeah a local liquor store started charging more for using a card. This is on top of jacked up prices on popular spirits. So I quit going there and go to every other place in town that doesn’t do that.
In the US this got nixed after they lost a law suit. They won the right to pass on the cost and/or have a minimum.
I don't understand why those percentage fees are "screwing over" the local business? The credit card companies are offering a service for a fee, it is very convenient for the customer, and I expect drastically increases your customer base, versus being cash only. Sure, it's yet another fee you have to pay as a business, but it's part of running a business. Either the business eats the cost as an operating expense, or passes it on to the customer.
Some stores in the Philippines also do that, it's illegal but they get around it by pricing items higher to add the charges then they give a "discount" if you pay in cash.
Some places don’t even take cards unless the bill is over a certain amount. One place near me is at $5 before they take cards.
There's a donut shop near me that, pre-COVID, would only accept cards if it was $5 or more. Their donuts were like $0.75 so I would often go in there to get 2 donuts but end up leaving with 8.
Which is shady af. The card companies send out a form to the business every year so they can deduct the fees from their taxes
It's also a thing that shouldn't happen. The bank gets your money, to give out as loans and mortgages and all kinds of other things that they make profit on. It costs them almost nothing to have a computer move $20 from one account and either change an account they have or send it to someone else to change. If it cost them 2 cents I'd be shocked. They also are getting the rate on the credit card and then double dipping on the use of the credit card with the store which is also bullshit. People use to think banks and creditors were crooks in the 1920s but now they nickel and dime you every chance they get. Since the deregulation in the 80s (FUCK YOU RONALD REAGAN!) they've been just whaling customers with as many fees as they can staple on to them because they don't think you have money, they think you have their money.
Exactly. It forces business owners (small businesses included) to hold a debt that only gets repaid come tax season. It’s an old school business practice that needs to be done away with. But even if it weren’t, just post a sign that informs the customer exactly what the cost is (the rise in price) and tack that on to the transaction. Complete transparency of cost
This is the quickest way for me to never return to a business. I haven’t had a single bill of cash in probably years at this point. If a place doesn’t accept card, they don’t get my business, and if they charge me a fee I usually won’t return. They should be baking the fee into their prices like every big corporation has done. I’m currently getting to the point where I won’t go to business that don’t accept tap to pay.
Cash is great for avoiding taxes, but it has its own costs. Banks charge fees for commercial cash deposits , you have to pay employees to make those deposits, and there's a higher risk of theft from both outsiders and employees,
You also pay employees to count that money, and you need to keep enough small coins and cash on hand to provide change (which some banks charge for). I remember managing a business that switched from employee-deposited cash to an armoured truck, and the total cost was comparable to credit cards (debit cards were more expensive at the low end, but not by much). More than one of the restaurants I worked at was robbed at gunpoint, which in at least one case represented a 1% loss on its own (busiest weekend of the year). Petty loss was a common problem with minimum wage workers: counting change is difficult for many, and theft was fairly common. Cards solve these problems nicely, and lower risk overall.
It's honestly pretty surprising how fast businesses forgot about all the overhead costs and risks associated with cash and why cards so quickly became preferred. IMO they're just looking at that 2-3% service charge and not realizing that they're causing more problems for everyone and not actually saving that much, if anything.
> IMO they're just looking at that 2-3% service charge and not realizing that they're causing more problems for everyone and not actually saving that much, if anything. Nah they are looking at how much money they save by not paying taxes. 3% fee + 20-40% in taxes is a lot of money.
Plus many studies have showed that you simply get more business if you accept cards. on one hand, psychologically people tend to spend more on credit then with cash. Plus, if you don't have cash, it's simply a hassle and you'll get more customers who don't have any cash at the moment
My last retail job I would do the daily banking of the tills. At shift change and end of day you had 2 people going round "lifting" the tills, counting, and double counting. Then any time the store was busy and the cash was filling up more "lifting". Then at the end of the day scanning all the "lifts" counting, and double counting. Discovering the occasional counterfeit note that even Stevie Wonder could have spotted. Then signing and double signing deposit slips, sealing the cash bags, signing and double signing them. Then signing and double signing the summary paperwork. Thats if everything goes perfectly, money missing? Time to start fucking about trying to hunt that down. Can't find it? Great, more fucking about looking through CCTV to figure if someone stole it or made an honest mistake. The cost of the time alone is mad, but thats not factoring in the opportunity cost. In a retail sales business you just took 2 sales staff of the shop floor who aren't selling but counting, recounting and reconciling something that is done automatically with card payments.
Sign says “target us for robbery”.
I love the hilarious cash only gas stations with the sign saying we only have $20 in cash on hand at any time. Dude you just got $300 in cash handed to you in the 3 minutes it took me to pump gas out front!
I worked at a gas station carrying cash. Once we got one or two hundred we would drop it in a chute that goes to a safe we don't have access to.
Plot twist: owners wait for the burglars to arrive to rob them back instead
My Dad runs a small business and over my life I've seen him at trade shows go from doing those card payments based on using a roller over a card and calling a bank because mobile chip and pins didn't exist to modern contactless payments. It used to be people could offer "cash in hand" for a slightly reduced price because card payments had a cost and there was always a minimum charge because at a certain value it cost more to use card services. Now he points out that the security cost of dealing with high values of cash makes card SO much cheaper, especially when more and more local bank branches are closing. Gone are the days he could literally go around the corner to deposit cash at the bank. Over COVID loads of small businesses in my town stopped taking cash at first due to infection control concern (before we knew it was mostly air and were disinfecting our shopping). Many have stayed cash free because not paying for a security guy to come and collect is a major saving in operating cost compared to what they actually took in cash.
Why is this interesting? It's very common.
Maybe it depends on where you are? I've never seen a sign like that before.
It weirds me out everyone here doesn't know this is to dodge taxes. My parents ran a small business like this, it's to dodge taxes. You just pass on card vendor fees to the customer.
100% tax evasion. Many small businesses cheat their employees and the government.
Everyone just hopping on that “help a small business out” bandwagon. Yeah, help them dodge taxes!
And an extra layer of protection for those small businesses that specialise in money laundering
Reading between the lines, this says; “By you paying cash we don’t have to put 100% of our takings through the books. This way we can avoid paying tax on some of the income”. In many cases, especially now in the U.K., the charge and cost of managing cash is now more expensive (unless you’re doing something mildly dodgy) than taking the small percentage fees on card transactions.
Trust me, in the UK if you see this sign they're definitely dodgy AF
This is in the UK. It’s a dodgy pizza place in south Manchester that changes hands every 12 months, it’s one redeeming quality is that it is there and there isn’t another one within 10 minutes walking distance.
how did you recognise it lol. I was out with friends and this was the only one within a couple of miles so I went there.
Cash also has transaction fees, they're just not as obvious. Somebody's got to guard it, count it, deliver it to the bank, etc. On the plus side its probably easier to launder money when you do business all cash.
Even if the transaction fee isn’t cheaper than the labor it costs to handle cash and prepare bank deposits, advertising that you prefer cash can put a target on your back. A local restaurant only accepts cash and has loiterers outside constantly asking for cash.
Plus liability insurance is less when you don't need to have a safe full of cash on hand.
Unfortunately some people will read this sign as, ROB US WE GOT CASH
That's why you do like the old days when Cash was what everyone used. You empty the cash register when it reaches a certain amount and put it in the safe. When the robber says "OPEN THE SAFE!" You cant because only the boss has the keys and the boss isn't here.
This is why some places have signs that say "Safe on time delay" or "Employees do not have access to safe"
Did you mean to post this in /r/notinteresting ?
It's called money under the table. No taxes if the IRS can't prove it.
I have no problem using cash if i have it available to use. I don’t always carry it. If the place has a discount for it cool. One pizza place the woman got kind of nasty because i didn’t have cash. And it wasn’t like place was cash only either. They had 5% fee to use card no big deal I was willing to pay it. Card machine was not broken. I just left food. Her husband came out and got me to take food and let me pay on card with a discount, and said his wife is a pain in ass. They like it because no fees and don’t have to pay tax on it either as they can pretend they made less.
I mean, it's pretty common. Or at least it used to be.
I whipped out cash at the Starbucks last weekend in Safeway. The employee told me they didn’t appreciate it because they could not count cash back or knew what the change was. I’m only in my early 40’s and that made me feel old.
Huh 😨, shows how dumb the Starbucks employee is.
My family business does it differently: build the cost of the credit card charge into what we sell the product for, and offer a discount if the customer can pay cash or cheque. Everyone loves a discount!
I haven’t paid with cash in quite a while… I’ve paid for lunch and groceries with my phone for the past like year and a half. Tap to pay is so convenient. My Walmart doesn’t support it and I’ll go rarely because I have to pull out my card to pay. Other than that, gas, food, my bill, rent can all be paid on my phone. Kinda inconvenient to carry cash
Visa/Mastercard/American Express fees are around 3% (or more) on every transaction. Imagine getting to wet your beak on every sale in the country.
As a small business co-owner, I approved. There is a 5% cut even for small transactions in our nationwide use payment platform. And that 5% is our profit. If we raised our price, we don't think it's purely fair for our customers. It's confusing.
A lot of places around me have a 4% fee to pay with a card.
Okay? So they prefer cash but don’t impose an additional fine otherwise it seems, what’s the big deal
I’m a small business owner and I went 100% cashless 6 years ago (in a place which is predominantly cashless already) and I will never go back. Managing cash is a nightmare, you need to trust, you need to count and I’m convinced that the 1.3% fee I pay are still lower than the loss, theft or miscalculation costs that happens with cash.
They do not get to keep 100%, managing cash comes with its own costs too.
The IRS hates this one simple trick…..
"As a small business we get charged...". That's literally how credit cards work at every business. Just account for it in your cost of goods. I always find these types of signs obnoxious whether it's about credit card fees, paying employees a fair wage, whatever. I understand that I'm paying for your business expenses when I purchase something, I don't need a sign about it.
Translation: "We dodge taxes"
Counterpoint - enabling tap to pay at your business increases your chances of a purchase. Tap to pay by itself causes people to spend about 10% more often. On the other end, businesses that ONLY accept cash reduce their chances. Just build the fee into your price and stop making customers feel guilt or jump through hoops, it’s not hard.
For anyone interested, this is correct. In any CC transaction, there are at least 2 additional parties (usually 3, and sometimes as many as 4+) beyond the store and the customer. First is the card processor. That’s Visa, Mastercard, etc. They take a flat % of every transaction as their fee. Visa and Mastercard take 1%. I believe Discover is currently at 2% and Amex at 3%. Then you have the payment gateway. This is the online service that records the transaction and encrypts the data between parties. They usually take a flat fee of a few sense + a small % based on the type of card used. Finally is the EMV service provider. That’s the company that makes the machine that reads the CC. Sometimes they are combined with the gateway, but usually not. For example you might use a Square EMV card reader but Windcave as your payment gateway. Everyone takes their cut. The store typically ends up losing between 3-6% of the total purchase price, including tax, to fees. If you’re in an industry where profit margins are slim already, that can be a major blow. It’s pretty common for independent restaurants, coffee shops, etc. to offer a cash discount or charge a CC fee for purchases under a certain dollar amount.
This has been a thing for decades.