Cash-only businesses lose 11+ million customers | finder.com
card-terminal

Small businesses that don’t accept credit cards losing 11.8 million customers

Businesses could be turning away thousands of dollars by not offering a card terminal.

When you live in a bigger city, it’s easy to take accessibility for granted: public transportation, 24/7 laundry, corner convenience stores — and paying for nearly everything with a credit card.

It can be unnerving to be at the register of a business that doesn’t offer the ability to pay by plastic. Without cash, you may even walk away from the sale.

Big potential revenue losses

reportOur research team put these words to the test by commissioning a survey of 6,838 American adults. The survey was conducted by global research provider Pureprofile.

Our findings showed that businesses choosing not to invest in a card transaction facility are losing an estimated 11.8 million customers.

This means that a retailer with an annual turnover of $2 million could lose $73,000 in potential annual revenue.

With consumers less likely to carry loose cash, businesses that do not provide card paying facilities are at a growing disadvantage. A 2015 ATM Marketplace report discovered that 5% of Americans don’t carry cash on them.

Our research team found that some three-quarters of people (73%) would leave a store without making a purchase if it didn’t offer a card terminal and they didn’t have cash on hand. Of that 73% — comprising 11.8 million Americans — 36% said they wouldn’t buy anything from that store, and the remaining 37% indicated they would try to shop elsewhere.

The remaining 27% would find an ATM and come back to the store.
Credit card processing for small businesses

Small businesses likely to suffer

Small businesses are especially susceptible to revenue loss if they don’t have a card terminal in their stores.

Fred Schebesta, finder.com’s CEO, isn’t surprised that small businesses could lose customers by not having credit or debit facilities. “Small businesses rely so heavily on their customer base that if a customer has a negative experience, they are likely tell their friends and family about it,” he says.

Millennials are most likely to shop elsewhere if a merchant doesn’t provide the flexibility to pay by credit or debit card.

Demographics across the board

Generational. Our studies looked at three major demographic groups to learn how cash only can affect the way they shop:

  • Millennials — ages 18 to 34
  • Generation X — ages 35 to 54
  • Baby boomers — ages 55 to 74
If a merchant does not have card facilities, I will shop somewhere else:
  • Millennials — 45%
  • Generation X — 37%
  • Baby boomers — 33%

If a merchant does not have card facilities, I will leave the store without buying anything:

  • Millennials — 43%
  • Generation X — 35%
  • Baby boomers — 22%

Gender

When it comes to men and women, 63% of women would not return to a merchant that doesn’t offer a card terminal, compared with 37% of men. The remaining percentage would make an effort to find an ATM and come back to the store with cash.

Income

How much a person earns plays an important part in a buyer’s mindset. Shoppers with higher income levels are more likely to leave a store that doesn’t have a card terminal without buying anything. Of those earning high incomes of $175,000 to $199,999, 77% would leave the store empty-handed. The remaining percentage would find an ATM and return to the store with cash.

For lower-income earners making up to $9,999 a year, 70% would forgo the purchase, and 30% would withdraw cash from an ATM and return.

State

By conducting a state-by-state analysis, we found that Oregon had the lowest percentage of people (21%) who indicated they would find an ATM if the merchant did not offer a card terminal. Oklahoma clocked in as having the highest percentage of people (30%) who would withdraw cash and return to the store.

As far as people who would leave the store and not buy anything at all, Kansas and Kentucky both had the highest percentage of people at 47%. Nebraska indicted the lowest percentage of people at 25%.

The world is moving ever further in a digital direction. To remain relevant and prevent future revenue loss, businesses must consider adapting to accept debit and credit cards at the point of sale.

Eleven states were excluded from our state-by-state analysis due to sample sizes of under 40 people.

Compare business credit cards

Small businesses can benefit not only from accepting credit cards, but also using them for expenses. While researching how to begin offering customers the option to pay by card, think about how a credit card could help your business. Consider getting a card that offers rewards in the areas that your business spends the most.

Updated June 20th, 2019
Name Product Rewards Purchase APR Annual Fee
N/A
0% for the first 20 billing cycles (then 12.24% to 20.24% variable)
$0
Enjoy a market-leading 0% intro APR on purchases and balance transfers for the first 20 billing cycles, reverting to a variable 12.24% to 20.24% APR. Rates & Fees
5% back at US office supply stores and on US wireless telephone services on up to $50,000 annually (then 1%). 3% on a chosen category on up to $50,000 annually, then 1% after and on everything else
0% for the first 15 months (then 14.49% to 21.49% variable)
$0
Save on interest with a 0% intro APR on purchases for 15 months. After that your APR will be variable. Rates & fees
2x points on everyday business purchases on up to $50,000 annually, then 1x points
0% for the first 12 months (then 15.49% to 21.49% variable)
$0
Earn 2x Membership Rewards® points on everyday business purchases on up to $50,000 with no category restrictions. Rates & fees
12x points at Hilton, 6x points on select business and travel and 3x points on all other purchases
17.99% to 26.99% variable
$95
Earn 125,000 Hilton Honors Bonus Points after you spend $3,000 in eligible purchases within the first 3 months of card membership. Rates & fees
2x miles on Delta purchases and 1x miles on all other purchases
0% for the first 6 months (then 17.99% to 26.99% variable)
$0 intro annual fee for the first year ($95 thereafter)
Earn 70,000 bonus miles after you make $4,000 in purchases on your new card within your first 3 months. Plus earn $50 after you make your first Delta purchase in the same timeframe. Rates & fees
4x points on two categories on up to $150,000 combined annually, then 1x points after that and on all other purchases
16.49% to 24.49% variable
$295
Earn 35,000 Membership Rewards® points after you spend $5,000 on eligible purchases with the Business Gold Card within the first 3 months of card membership. Rates & fees
5x points on flights and prepaid hotels through Amex Travel, 1.5x points if you spend $5,000 on a single eligible purchase on up to 1 million additional points per year and 1x points on all other purchases
N/A
$595
Earn 50,000 points after spending $10,000 and an extra 25,000 points after spending an additional $10,000 on purchases in the first 3 months from account opening. Rates & fees
2x points on purchases through Amex Travel and x points on all other purchases
N/A
$0 intro annual fee for the first year ($95 thereafter)
Earn 5,000 Membership Rewards® points after your first purchase on the card within the first year of card membership. Rates & fees
1.5% discount when you pay early
N/A
$0 intro annual fee for the first year ($250 thereafter)
Get a 1.5% discount when you pay early, with no cap on what you can earn back. Rates & fees
6x points at Marriott Bonvoy, 4x points at US restaurants, US gas stations and on US wireless telephone and shipping services, 2x points on all other purchases
17.99% to 26.99% variable
$125
Earn 75,000 bonus points after you use your new card to make $3,000 in purchases within the first 3 months of card membership. Rates & fees
2x miles on direct Delta purchases and 1x miles on all other purchases
0% for the first 6 months (then 17.99% to 26.99% variable)
$450
Earn 80,000 bonus miles and 5,000 Medallion Qualification Miles (MQMs) after you spend $6,000 in purchases on your new card in your first 3 months. Rates & fees
2x miles on direct Delta purchases and 1x miles on all other purchases
0% for the first 6 months (then 17.99% to 26.99% variable)
$195
"Earn 5,000 Medallion Qualification Miles (MQMs) plus 80,000 bonus miles after spending $6,000 in the first 3 months. In addition, earn a $100 statement credit after you make a Delta purchase with your new Card within your first 3 months. Rates & fees
7x points on rideshares, 4x on Brex Travel, 3x at restaurants, 2x on software subscriptions and 1x points on all other purchases
N/A
$0
The first corporate card for startups. No personal liability or security deposit needed, meaning your personal credit score won't be affected.
N/A
N/A
$0
60-day interest-free financing for e-commerce businesses.
3x on travel, shipping, Internet, cable, phone and online ads up to $150,000 combined annually; then 1x after and on all other purchases
18.24% to 23.24% variable
$95
80,000 bonus points after you spend $5,000 on purchases in the first 3 months after account opening. That's $1,000 toward travel rewards when you redeem through Chase Ultimate Rewards®
5% on office supplies, Internet, cable and phone up to $25,000 combined annually; 2% on gas and dining up to $25,000 combined annually; 1% on all other purchases
0% for the first 12 months (then 15.49% to 21.49% variable)
$0
$500 bonus cash back after you spend $3,000 in the first 3 months

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For media inquiries:

Rachel Dix-Kessler headshot
Rachel Dix-Kessler

Public Relations Manager at the forefront
of personal finance trends.

rachel.dix-kessler@finder.com@rachdixkessler/in/racheldixkessler

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