If I could pay by card in your shop - I'd do shopping here | Hacker News Reader

If I could pay by card in your shop - I'd do shopping here

blog.karolzielinski.com

There is currently an attempt to pass a bill limiting the fees banks can take from merchants when someone buys using a debit card. The supporters of this bill tend to myopically ignore points like this (among other things).

Edit: Recent story on this: http://online.wsj.com/article/SB1000142405274870425660457529...

I wonder how much of this policy has to do with tax evasion? It's hard to avoid reporting credit/debit card income.

For the shop owner(s), making the economic case for having a card merchant account comes down to several factors:

- Size of typical transactions - Volume of transactions per billing cycle - % of charge-backs per billing cycle - Charge-back volume compared to revenue - Anticipated volume & revenue gains with the additional card buying channel - Comfort level with dependency on 3rd-party accounting - Comfort level with 3rd party data mining - Comfort level with necessary technologies - Additional management overhead due to accounting and card accouterments

Offhand, there are a variety of scenarios, esp. for boutique businesses in urban environments with ready access to ATMs, where a cash-only policy makes good business sense.

Sometimes it doesn't have a sense to install terminal for card payments. However it's a very rare exception.

In most cases not-only-cash policy makes good business sense. Especially when the competitors from the same street or at least competitors from the same industry have such terminals.

competitors from the same street or at least competitors from the same industry have such terminals.

Same street or same industry doesn't mean focusing on the same clients. If most of your clients come for milk, bread & butter, it doesn't make sense to install hardware just because 2 dudes want to pay card for a pack of cigs.

I have 2 shops like that near me and both run well. The one which has more products and card payment obviously earns more and you can see that, but it doesn't mean that it's not a win-win situation, nor that the main reason of one's bigger success is the presence of a terminal.

In Canada, some shops are opting to put bulky ATM machines in their store instead.

Like OP, I also often don't carry cash, and I'm from Poland, however I assume certain rules apply to other countries too.

TINSTAFL. Shop owner pays for the POS terminal, pays for the phone connection, pays some percentage of the transaction and even for the printed logo on the bill. I don't believe any business owner would pay for that without charging clients for the cost, so in the end, it's split out onto the products prices. Specifically in Poland there's a law that f.ex. cigarettes cannot be charged more than the MSRP, but the rest of products obviously can, so in the end, you are the one who pays for the comfort of paying with plastic.

Also, cash is billed directly, money from bank transactions come with a (afair 2-3 days) delay, so obviously paper gives the business owner a better cash flow than plastic. Oh, and a very-cheapo Polish 7-11-alike Biedronka after many years of operation afaik still doesn't accept cards, and besides slave labour I think it's also a matter of being able to drop prices a bit more. So there's probably some common sense there. I don't like being unable to pay with card though.

Biedronka is a discount shop. We can't require from these kind of shops that they may want to pay extra money for using terminals for card payments. Remember that in many of these stores you could find an ATM next to the till.

Most of the shops are not discount stores. They have normal products, with normal prices. They can (and should) pay some extra money for a possibility of card payments, because if they want to exist - they need to meet customers' needs. Today, most people expect that they will be able to pay by card.

in many of these stores you could find an ATM next to the till.

which probably charge you for the transaction a lot, if it's not your bank or euronet.

I'm generally with you, I expect that services meet my needs and if I have a choice, I choose the ones that do. Personally it's sometimes hard to believe that someone can run a business excluding me as a target client ;) but somehow it's possible. And surprisingly, lots of the shops we assume they would struggle to exist, still run very well.

It really depends on location. At my uni, most of everything is pay with cash, all the shops are close to an ATM so it really isn't a big deal and can help move things along if there are a lot of people around.

Other stores though it is frustrating, the thing that frustrates me the most is news agents with a $10 minimum when a newspaper is probably less than $2 and the average magazine comes in under to. I've offered to pay $10 for a $8 magazine before to avoid the hassle just to be told that they won't let me so I have to buy something I don't want to make the $10.

I understand the transaction fee problem, but I think the goodwill you get by allowing pay by card no matter how small the purchase offsets this.

I agree that paying by cash can help move things along, but that's the only one (in my opinion) argument for this kind of payments. I don't want to say: 'don't take cash', just: 'give your customers a choice. give them a chance to pay at least by cash, or by card'.

As for an amount of purchase... I understand transaction fee problems related to these kind of things. That's why I think that people need to realize that if they want to pay by card - they need to buy something more then just a newspaper. Unfortunately we can't jump over the bank charges.

However... it would be a really good idea to build a system, which would take money from your bank account or a credit card once a month for all the things you bought in that month.

Sometimes card is quicker. I know at my Tesco I'm quicker getting through using a card, but hate it when I'm stuck behind someone who goes through and counts their coins, or the cashier has to root around for change.

With the card it's just swipe and pin. Done.

Also the minimum is against Visa's merchant agreement. You can report them to visa to get that changed. I was at a pub once that said £10 minimum, but just before I was going to argue he said he would charge it up for £10 and give me the change. Fair enough I suppose.

I've recently moved to NYC for the summer to work at an internship and I'm surprised at just how many places here take cash only. For the first time in years i'm walking around with cash in my pockets, whereas back home my wallet is always empty except for my credit cards. It isn't just small towns but big cities as well. I will agree that visa is easier for the consumer, but I won't avoid shopping/eating somewhere that takes only cash.

Certain shop owners fail to realize that managing cash (instead of plastic) is expensive too -- probably even more expensive than AMEX extremely high fees. If you factor in: counterfeited currency, risk of robbery, lost business, trip to bank to deposit/withdraw cash etc,, it's easy to see how expensive managing cash is. Here in Holland i'm actually starting to see shops that only deals with plastic and don't accept cash.

I think that don't accepting cash is a little too much. However I agree with you. Managing cash could be even more expensive then managing money on electronic bank accounts.

We actually find in our bricks&mortar that it's least expensive to deal with cheques (but only very very rarely does someone pay with a cheque). Customers believe that it is better to pay cash and that we must be charged a lot for card payments (they offer to go to the cash machine down the hill). Reality is that the bank screws us either way^W^W^W^W charge us for cash and card at about the same rate in our case - they make cheques free as we're an SME.

Maybe the shops have their reasons. Don't know - I never run a shop. But I have a feeling the author of the article doesn't really know either.

True. I've never run a shop.

However I know few of the shop owners. All of them are saying the same thing: problem is money or sometimes technical issues (e.g. someone doesn't know how to use computer or a terminal for card payments; doesn't want to learn new things; is afraid of new technology).

Most of the places I see that don't take cards are newsagents - hardly difficult to see why someone in that line of business might be a bit reluctant to make a capital investment.

It the same mentality that cabbies are against taking cards in taxis.

They did studies and found people tip more when using a card. And I know if I don't have cash myself and I know the cabs will take a card I'd catch one rather then find some alternative.

Absolutely agree. Good point.

Actually having a cash buffer and paying with it is quite healthy habit.

You get this understanding after a while though, for me it was past 30.

Pay with cash: keep the fat cat bankers out of the deal.

Unless you have to go to an ATM and pay a fee for using cash that's much greater than what the merchant is charged for the transaction.

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