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Comment by languagehacker | Hacker News Reader

Being a cash-only business is an annoying disservice to your customers. It's a sign that you're not interested in the value of convenience. It's a regressive attitude to lean on cash, and oftentimes a sign that you're not interested in keeping honest books.

If you're not willing to pay what is almost universally accepted as an operating cost in modern society, you're setting yourself up to be left in the dust, and quickly. People are about to start paying for everyday transactions using their phones! If you have a problem with payment processors biting into your margins, then pass the buck onto your customers (even as a credit card usage fee), but never take away a payment option.

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I completely disagree with what you're saying, but it may be because of the city that I'm living in - Columbia, SC. Many, many shops and stores down here don't take credit cards and it is not rude to the customer at all. In most cases the store has been around since before credit cards were popular and it is you who should adapt to the store, not the other way around. And there will always be stores that couldn't function with the cost of processing credit cards (not only the transaction cost, but the time and equipment cost to setup and maintain a processing system).

Basically you learn to have an extra $20 on you when you're walking around certain areas of the city and it's not a big deal at all.

Credit card usage fees are a good way to a) make your customers mad and b) be blacklisted by your CC processor (possibly sued).

Nearly every processor agreement stipulates that this is a no-no.

Indeed, although giving a discount for paying with cash is often allowed. (Customers generally hate hidden fees more than they hate missing out on a discount.)

It's not a way to cheat the system though, since you still have to advertise the higher price. Even if you also say "5% discount for cash transactions".

it's fairly common around here at the 'independent' gas stations to advertise two prices; one for cash, and one slightly higher for credit cards.

It seems very fair to everyone I know who has ever had a merchant account; people who have not, on the other hand, sometimes think it's unfair.

If you know of any specifically, would you mind submitting them here? http://discountwithcash.com/app/node/add/business

Thanks!

Then how do universities and state licensing locations get to charge 5% fees on all credit transactions? Do they have separate deals?

it's funny, I mean, many of my suppliers of bandwidth and rackspace accept credit cards. No fee, usually.

I'm amused at this thread because I woke up this evening to a bill from a provider that I recently did an especially good job negotiating with, and the guy wants a 3% payment processor fee on top of the negotiated amount.

(I'm going to leave an envelope with a cheque at the co-lo for him; gotta go anyhow.)

They probably give you a 5% discount for NOT using your credit card.

> pass the buck onto your customers (even as a credit card usage fee),

Visa and Mastercard expressly prohibit surcharges for transactions made with their cards so that is not a workable solution.

...and thus the concept of the "cash discount" was born.

And while it's purely a semantic distinction, as a consumer, I feel far better about getting 10% off the menu price at restaurants for paying cash, than I would feel about a 10% surcharge for paying with my credit card.

Cash discounts are only allowable by the merchant agreements for some kinds of transactions, such as gas stations.

A lot of people offering "cash discount" are technically violating their agreements with VISA/MC.

Not since 2010. The Justice Department reached a settlement with Visa and Mastercard overturning this provision:

http://www.nrf.com/modules.php?name=Newsletter&op=viewli...

My absolute favorite breakfast joint does not take CC. The place is packed every day, and consistently gets voted best breakfast in my city. If you provide a good product, customers will put up with a minor inconvenience like walking half a block to the bank to withdraw some cash.

If you are a patron at a place you like, and you want to support them, you pay in cash, and its polite of you to do so. Thats a little bit extra for the establishment and a little less for Visa/EDS/Chase or whatever payment chain your transaction flows through.

I think that locally owned stores where the typical transaction is less than $5 are an exception. (Does this even describe anything other than local coffee shops?) I pay cash for my coffee everywhere I go. People typically don't go to locally owned shops for the convenience, but for the charm. And if you're a regular, then you know to carry some cash.

Coming from a smaller city in Florida I was surprised at how many cash-only restaurants there are in Berkeley, I mean, it's the Bay!

Granted, Berkeley seems to have its own notion of what it's culture should be and people don't seem to mind paying cash only. I think it's important to realize that you are projecting your own expectations onto other people's products, and in their minds they are perfectly happy losing your business so that they can focus on cultivating the kind of customer base they want.

Take Starbucks as an example of the opposite extreme, they take credit cards, drive thru, have uncomfortable chairs and loud music to discourage seating all in the effort to move as much coffee as possible. Starbucks does pretty well, but it's probably in this guys best interest not to try and copy Starbucks.

How true is loud music actually? Was it taking the beating of Starbucks to the next level, or they really want you to get out of their property asap?

In Austria you can only pay by card in chains or touristy places. Even there it is socially unacceptable for amounts less than 10 Euros. I always cringe when I am in the States or somewhere like Argentina where people pay for a coffee with a CC. It is so slow. Especially in Argentina where you need to show an ID. Great way to create extra jobs by making something less quick through technology though.

You are talking for the USA only. Pretty much everywhere else, using (and accepting) credit cards is the exception, not the norm, and not even considered convenient by most people.

i'm perfectly happy to work with someone like a little neighbourhood coffee shop in their desire to avoid credit card processing fees.

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