Credit cards are cheaper than cash for most merchants. Most people forget about all the costs of cash because they are hidden, but they add up to more than the couple % credit cards cost.
Huh. I always thought it was the opposite. I know several restaurants that refuse to accept credit cards. They are great places to eat, but I won't go there. I don't think they miss my custom, though. Refusing to accept credit seems to be a signal of excellence, around here.
The cost of a credit card is very obvious. The cost of cash is many small things that are very hard to see and thus very hard to account for correctly.
For the same reason those food establishments had to get a government approved White Cash Register, because there was so much money disappearing.
* As long as you don’t raise any red flags in your accounting, which can be difficult.