Debit and credit cards are usually the preferred payment method over cash and businesses nowadays are adding cashless payment options. There is a growing cashless trend that is quickly becoming the norm and small businesses have more options for going cashless than ever before.
Accept cashless payments from you customers
If you are a cash-only business, you may want to consider accepting debit and credit cards and other mobile payment alternatives. Even if you still accept cash, offering cashless or contactless payment options will open more doors for your business. You will also be creating a faster and safer checkout process and streamline your accounting. The more transactions that you make digitally, the fewer you will have to account for manually.
To offer cashless transactions you can start by accepting debit and credit cards or take your cashless transactions further by accepting Apple Pay, Amazon Pay, PayPal, Venmo, and/or Google Wallet.
In order to do this, you will need to accept digital and mobile payments you will need a point-of-sale payment terminal or special app for in person transactions. The service you decide to use will help get you onboarded to their system with the right device(s) and/or technology.
Negotiate cashless payments with vendors
Your vendors might also want payments from you digitally or via card. In addition, you might want to pay them online too. The best way to approach cashless payments with vendors is to simply ask them if they have their own digital POS option.
There are several benefits of cashless vendor payments that are a win-win. You will have a digital record of all your expenses which makes accounting easier. Your vendors will get paid faster because they do not have to wait for their check to arrive by mail.
Open an online business bank account
Going cashless in business is not limited to customer transactions or vendor payments. You can also do your business banking entirely online. If you are not sure about an online business bank account, ask yourself the following:
- Do you use an ATM or go to a bank branch?
- Do you pay monthly or hidden banking fees?
- Does your bank impose minimum balance requirements?
- Do you want to earn interest on your checking account balance?
Pros and Cons of a Cashless Business
The following are benefits of being cashless in your business:
- Lower crime rates: carrying cash makes you an easy target for criminals.
- Automatic paper trails: money laundering becomes much harder if the source of funds is always clearly identifiable. It is harder to hide income and evade taxes when there is a record of every payment you receive.
- International payments are easier: when you travel you might need to exchange your dollars for local currency.
The following are disadvantages of a cash-free world in your business:
- Privacy is sacrificed: the more information that is out online, the more likely it is to end up in the wrong hands. Cash allows you to spend money and receive money anonymously.
- Cashless transactions are exposed to hacking risks: In a cashless society, you are more exposed to hackers. If you are targeted, and somebody drains your account, you may not have any alternative ways to spend money.
- Technology issues may occur: glitches, outages, and innocent mistakes can cause problems, leaving you without the ability to buy things when you need to.
- Temptation to overspend can increase: With electronic payments, on the other hand, it is easy to swipe, tap, or click without noticing how much you spend. Consumers may have to rethink the ways they manage their spending.
The Bottom Line
Nowadays, more and more businesses are going cashless because it is becoming the preferred method of payment for many consumers. If your business has not gone cashless yet, give it a try and pay attention to how your customers react to it and see if it is the right method for you.