Card or Cash?

Card or cash?

Card or cash?

So you have given a treatment to a client and you ask them to pay. They haven’t got enough cash or a cheque book. Do you:

  • Tell them where the nearest ATM is?
  • Ask them to post you a cheque?
  • Take a payment by card?

News yesterday that that the UK might ditch the penny coin, swiftly followed by a kind of promise that we won’t.  But we kind of will won’t we, because we are using cash so much less, and contactless is so easy…..

I don’t keep pennies anymore, they all go straight into the charity tin next to the till. I can’t think of any other use for them, they are heavy, they don’t buy anything, why keep them. Well the charities will be sorry to see them go, but even for them the value in a full collecting tin is minimal.

For small businesses though the difficulty is to collect payment without the cost of card readers and merchant accounts. Nobody offers this free to business but there are a few suppliers of card readers that don’t need a merchant account. Square-up, Stripe, iZettle and Sumup charge between 1.4% to 1.7%. there don’t appear to be any other charges, but they hang on to your funds for a couple of days so presumably they make money from investing those funds.

Banks tend to charge  a flat monthly fee for current accounts for small businesses, ranging from £5 upwards, but they also charge for cash or cheque payments, with the exception of Santander which charges £20 fixed monthly

fee.  If you pay in £500 in cash you will pay anything from £1.50 to £5.00, and if you pay in 5 cheques you would be charged from £1.50 to £3.00. Using a card reader this would be around £7.50.