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Nowadays, there are multiple ways to accept payment as a company. Limiting your customers to one mode of payment could prevent you from getting as much business – for instance, not everyone carries cash around with them. However, accepting multiple payments can have drawbacks, including making extra work for yourself or potentially costing you some of your profits. Not all forms of payments are suitable for every business, which is something to also consider. Here are just some of the main methods of payment, and whether your business should choose to use them.
Fewer customers are using cash. It requires more work for the payer and payee – you’ll need tills and a safe to keep the cash in, plus you’ll have to count up cash each night and work out the tax owed on it. That said, if you’re a high street business, most customers will expect you to deal in cash – there are very few cashless shops. Accepting cash isn’t so much of a requirement if you’re an online business. Whilst you can send money using a postal order, this is less convenient and more costly for the person paying as it requires them to pay postal charges.
Checks can be used to pay large amounts of money, rather than taking out the amount of cash. They are slightly outdated now due to debit cards largely performing the same role, whilst being faster and more convenient. The advantage of checks is that you get to choose when to deposit them in your account, however, you do have to manually go down to the bank to deposit them.
Every business has a reason to accept a debit card. Even market stalls are now seeing the advantage and buying card readers. This is the only downside to accepting debit card – you need to buy a card reader. However, card readers are relatively cheap these days and easy to set up. There are even portable card readers for handymen and delivery couriers. It’s worth investing in a modern card reader that allows for contactless payment as most cards now work contactless.
Credit cards are useful for high-value transactions, in which the payer may not have the money in their account at the time. There are costs to accepting credit card – you’ll need to buy a credit card reader and pay a small amount towards each transaction. You’ll also need to set up a merchant account for accepting these payments. For shops that only deal with small transactions, accepting credit card may not be worthwhile as it could cost you a lot of your profits. However, a car repair center or a piano shop may benefit from a credit card reader as more people are likely to be paying using credit.
There are now new digital forms of payment that can be worth catering to. Digital wallet apps allow you to use your smartphone to pay for items just like a debit card. This involves buying a modern card reader that is set up to receive digital payments.