Although much commerce is now done online, there are still many business that still do ‘cash-only’ business. Although it may be impossible to only accept cash as a method of payment if your company only operates online, it can still be a viable main option for physical stores, mobile service providers and other offline companies. So, if you’re considering starting a business that operates in the cash only space, here are some of the main pros and cons to consider.
Pro #1. No delayed payments
Perhaps the biggest benefit of accepting only cash payments for your company is that you won’t need to deal with delayed payments. Rather than having to wait for a credit or debit card payment to process and the money to clear from your customers’ accounts, cash payments mean that you’ll have access to the funds immediately after the transaction has been made.
Pro #2. High payment security
Today, a high level of security when making payments is one of the main things that customers want when making purchases either online or offline. Although credit card payments are growing in popularity, cash remains one of the only popular methods of paying that allows for full anonymity and complete security when paying – handing over cash doesn’t require your customers to share their credit card data and therefore eliminates the risk of fraud.
Pro #3. Easier bookkeeping
When it comes to accounting for your revenue stream, cash-only companies often have it easier, since all transactions can be accounted for in the current period, resulting in less complex tax forms and returns.
Con #1. You could lose customers
Giving customers the option to pay via cash if needed is great, however, most customers don’t want this to be the only choice that they have.
With more and more companies now accepting credit and debit card payments, it’s unsurprising that many people have given up carrying cash altogether unless they really need to; they simply expect to be able to pay with their card.
And, with reasonably priced merchant processing accounts available, accepting credit and debit card payments is an investment that can really pay off.
Con #2. You risk falling behind competitors
Look around at your competitors – do they offer their customers the option to pay via card? It’s likely that they do – after all, with the ability to pay with a credit or debit card now expected by most business customers, an increasing number of businesses are making sure that they meet that need. Something as simple as not accepting credit and debit card payments can put a huge dent in your reputation and cause your business to look ‘behind the times’.
Con #3. You’re at higher risk of theft
Businesses that only accept cash also tend to have cash kept on the premises. Simply by having a large amount of cash in your till, you can be putting your company at risk of a robbery.
Cash-only businesses are still around today, however, the demand for credit card payments is certainly on the rise.