Should My Business Accept 'Cashless' Payments?

by Debi Enders

Over the past decade, consumers have been using cash, checks and plastic credit cards less, with more people – especially younger generations – preferring to make payments using a mobile phone or other smart device instead.

The shift to a cashless society, in other words, is well underway. By 2020, the U.S. is expected to reach the tipping point, with mobile payments becoming the primary way consumers will buy goods and services, send money, and conduct business.

If your small business is not already offering cashless payment options, now may be the time to make the switch. Here are a couple of reasons why it might make sense for you:

Cashless payment transactions are faster. Apple, Google, Samsung, Fitbit and Garmin now all offer mobile apps that make it easy to pay using a “digital wallet” on a smart phone or watch. By linking to existing accounts, these apps make it possible to complete secure transactions without entering payment information or physically sharing a plastic card. Cashless payments therefore take less time to complete than other forms of payment. That typically translates into shorter lines and faster checkouts and greater customer satisfaction.

Payment apps can be tailored to your needs. Consumers like the speed and convenience of digital wallets. But payment apps offer benefits to small businesses as well. Funds from these transactions are available to you within a day or so, helping improve cash flow. Many cashless payment systems also include tools for organizing and tracking inventory, managing customer reward programs, building customer databases and other time- and money-saving features. With many alternatives to choose from, you can tailor a solution to your business’ needs.

THE BOTTOM LINE: Cashless payments are becoming the norm, with a new generation of consumers leading the charge in demanding more ways to complete transactions. You owe it to your customers – and your business – to offer the solutions they prefer.

Debi Enders (debi.enders@commercebank.com) is vice president, small business banking at Commerce Bank.