I disagree. For a very large volume of very small transactions the time it takes to process 1 digital payment is a fraction of the time it takes to process 1 cash payment (and giving back change). For very small transactions in digital payment there’s no entering PIN, no confirming, no thinking and change giving, no opening cash registry or even putting it in a pocket or pouch, it’s incredibly fast nowadays. I don’t even have to put my card in the machine, just hold it in front of it, seller doesn’t have to count or give back, it saves enormous amounts of time.
You also have to pay for the cash truck service to get it safely delivered to the bank unless you’re a VERY small business and can just carry it all on your person.
500k a month turnover is not a small store though. Also it’ll likely be more for rural places where stores are smaller.
Local grocery store for me doesn’t even crack 100k a month I’m pretty sure. I don’t think they’ll even get close to 10k a day on st. john’s day, let alone any other day of the year.
Don’t forget that cash also means more errors (which in sensible countries do NOT come out of the pocket of the clerk, but rather eats into the store’s margins) and requires extra insurance because there’s always that tiny risk of someone literally robbing the place. And sometimes the employees themselves will pocket some. You’ll fire them, but it’s not like you’re getting any back.
You also need a safe, though luckily that’s a capital expense rather than an operating expense.
You can more or less say that cash has a level of natural loss attached to it. I have no idea how it compares to the ~1.5% that you’ll have to pay for card payments, but it’s not zero.
A “per stop” cash pickup is about €30 in Europe. So scheduling a pickup when you earn €1500 would match the 2% CC charge.
For me that is very risk averse, but others may disagree.
10k turnover and a pickup a day is a 0.3% cost.
Errors occur with digital too (wrong code etc) and are less likely to be noticed by staff.
I do agree with the last point. The cost of cash is not zero, and my original point was that the cost of cash increases with volume. There is a crossover point where digital becomes preferable.
I disagree. For a very large volume of very small transactions the time it takes to process 1 digital payment is a fraction of the time it takes to process 1 cash payment (and giving back change). For very small transactions in digital payment there’s no entering PIN, no confirming, no thinking and change giving, no opening cash registry or even putting it in a pocket or pouch, it’s incredibly fast nowadays. I don’t even have to put my card in the machine, just hold it in front of it, seller doesn’t have to count or give back, it saves enormous amounts of time.
That time saving costs 2%.
You also have to pay for the cash truck service to get it safely delivered to the bank unless you’re a VERY small business and can just carry it all on your person.
$500 a month for a small store. About 0.1% of turnover.
500k a month turnover is not a small store though. Also it’ll likely be more for rural places where stores are smaller.
Local grocery store for me doesn’t even crack 100k a month I’m pretty sure. I don’t think they’ll even get close to 10k a day on st. john’s day, let alone any other day of the year.
Don’t forget that cash also means more errors (which in sensible countries do NOT come out of the pocket of the clerk, but rather eats into the store’s margins) and requires extra insurance because there’s always that tiny risk of someone literally robbing the place. And sometimes the employees themselves will pocket some. You’ll fire them, but it’s not like you’re getting any back.
You also need a safe, though luckily that’s a capital expense rather than an operating expense.
You can more or less say that cash has a level of natural loss attached to it. I have no idea how it compares to the ~1.5% that you’ll have to pay for card payments, but it’s not zero.
A “per stop” cash pickup is about €30 in Europe. So scheduling a pickup when you earn €1500 would match the 2% CC charge.
For me that is very risk averse, but others may disagree.
10k turnover and a pickup a day is a 0.3% cost.
Errors occur with digital too (wrong code etc) and are less likely to be noticed by staff.
I do agree with the last point. The cost of cash is not zero, and my original point was that the cost of cash increases with volume. There is a crossover point where digital becomes preferable.