As the world becomes increasingly cashless & digital, the use of card payments has become the norm. It's convenient, easy, and fast, but have you ever wondered about the charges that banks place upon card payments? We know it can be easy to forget about the benefits that come with using physical currency. From the perspective of independent businesses, such as your favourite PIE restaurant & bar, it's waaaaaay preferable to receive cash payments over card payments for a variety of reasons. Let’s look at why cash truly is king in the restaurant industry.
Firstly, and most importantly, accepting cash means that the restaurant doesn't have to pay fees to a third-party card processing company. For small, independent businesses, every penny counts, and these processing fees can add up over time. When you pay with cash, we don’t have to worry about any additional charges. Don’t forget, we need all that money to pay the tax man!
Banks make money from card payments by charging a percentage of the transaction amount or a fixed fee. As a business owner, we have to pay these fees every time a customer makes a payment using their card. Depending on the payment processor you use, the percentage charged by the bank can range from 1% to 3%, and the fixed fee can be as high as €3 per transaction. These fees can add up quickly, especially if like us, most of our customers pay by card. Let’s all thank Fiona Edmunds for her example below. She’s talking in Australian dollars, but the logic applies here too.
Secondly, cash transactions are faster and more efficient. With card payments, there's often a delay between when the customer pays and when the money is deposited into the restaurant's account. This can cause cash flow issues and make it difficult to manage finances. With cash, the transaction is immediate, and the restaurant can easily keep track of their earnings.
Thirdly, accepting cash can help protect us all from fraud. While card payments are convenient, they come with risks, such as chargebacks and fraudulent transactions. By only accepting cash, we can avoid these issues altogether.
And cash is universally accepted. We accept most cards, but when you pay by cash there's no need to worry about whether your card will be accepted. This can be particularly helpful for small, independent businesses that may not have the resources to invest in expensive card processing equipment or accept a wide range of credit cards. And we’re not quite set up to accept Dogecoin yet either, soz crypto fans.
Of course, we still accept your plastic here at PIE Lagos. We know it's not always easy to remember to grab some cash before you arrive, and sometimes it's just easier and more convenient to use your card or your phone to pay. But, if you can, do remember that CASH truly is KING especially for small businesses. WE APPRECIATE IT!