11+ million customers are lost for cash only businesses | 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 December 16th, 2018
Name Product APR (Annual Percentage Rate) for Purchases Introductory Purchase APR Annual Fee
17.99% to 22.99% 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®
15.24% to 21.24% variable
0% for the first 12 months (then 15.24% to 21.24% variable)
$0
$500 bonus cash back after you spend $3,000 on purchases in the first 3 months after account opening
15.24% to 21.24% variable
0% for the first 12 months (then 15.24% to 21.24% variable)
$0
$500 bonus cash back after you spend $3,000 in the first 3 months
None (Charge Card)
$0
The first corporate card for startups. No personal liability or security deposit needed, meaning your personal credit score won't be affected.
17.74% to 25.74% variable
$0 annual fee for the first year ($99 thereafter)
70,000 AAdvantage® miles after making $4,000 in purchases in first 4 months of account opening
None (Charge Card)
$450
New cardholders can earn 75,000 Membership Rewards® bonus points by spending $10,000 on purchases for the first 50,000 points and then another $10,000 for the next 25,000 points on their new card in the first 3 months.

Compare up to 4 providers

Was this content helpful to you? No  Yes

US Credit Card Offers

Important Information*
Deserve® Classic Card
Deserve® Classic Card

APR

24.49
variable

Annual fee

0 For the first year
More info
Luxury Card Mastercard® Gold Card™
Luxury Card Mastercard® Gold Card™

APR

16.74
variable

Annual fee

995 For the first year
More info
First Access Visa Card®
First Access Visa Card®

APR

29.99
variable

Annual fee

75 For the first year
More info
Indigo® Platinum Mastercard® Credit Card
Indigo® Platinum Mastercard® Credit Card

APR

23.9
variable

Annual fee

75 For the first year
More info

Ask an Expert

You are about to post a question on finder.com:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder.com provides guides and information on a range of products and services. Because our content is not financial advice, we suggest talking with a professional before you make any decision.

By submitting your comment or question, you agree to our Privacy and Cookies Policy and Terms of Use.

Questions and responses on finder.com are not provided, paid for or otherwise endorsed by any bank or brand. These banks and brands are not responsible for ensuring that comments are answered or accurate.

US Credit Card Offers

Important Information*
Deserve® Classic Card
Deserve® Classic Card

APR

24.49
variable

Annual fee

0 For the first year
More info
Luxury Card Mastercard® Gold Card™
Luxury Card Mastercard® Gold Card™

APR

16.74
variable

Annual fee

995 For the first year
More info
First Access Visa Card®
First Access Visa Card®

APR

29.99
variable

Annual fee

75 For the first year
More info
Indigo® Platinum Mastercard® Credit Card
Indigo® Platinum Mastercard® Credit Card

APR

23.9
variable

Annual fee

75 For the first year
More info
Go to site