Paying with Cash…. Why is it better!?

[Darts]

I get 10% off my Chinese food paying cash plus I pay cash at small businesses so they can just stick it in their pocket.

I'm a one woman man now but back in the day I always pay the ladies cash or in Maple Leaf/Raptors tickets.

One lady said her son was a huge Raptors fan so I paid her with Raptors tickets.

 

[explorerzip]

This ran across my FB feed…. Interesting take.

Please understand what not using cash is doing !!!
Cash is important!
Why should we pay cash everywhere with banknotes instead of a card?

- I have a $50 banknote in my pocket. Going to a restaurant and paying for dinner with it. The restaurant owner then uses the bill to pay for the laundry. The laundry owner then uses the bill to pay the barber. The barber will then use the bill for shopping. After an unlimited number of payments, it will still remain a $50, which has fulfilled its purpose to everyone who used it for payment and the bank has jumped dry from every cash payment transaction made...

- But if I come to a restaurant and pay digitally - Card, bank fees for my payment transaction charged to the seller are 3%, so around $1.50 and so will the fee $1.50 for each further payment transaction or owner re laundry or payments of the owner of the laundry shop, or payments of the barber etc..... Therefore, after 30 transactions, the initial $50 will remain only $5 and the remaining $45 became the property of the bank thanks to all digital transactions and fees.

Credit: Elisha Belmont

The credit card companies / banks are gouging business because they add little to offer other than convenience.

Having said that, I think that Elisha's take is flawed too.

1. $50 collected in revenue does not mean $50 in profit. There's cost of goods sold on every transaction. The unlimited number of payments that she refers to doesn't quite work in the way she describes it.
2. Cash collected during the day must be counted, recorded and then deposited to the bank at the end of the day. The business has to deal with loss / theft and counting errors. As do the banks. There are still costs in doing this.

 

[poker]

The credit card companies / banks are gouging business because they add little to offer other than convenience.

Having said that, I think that Elisha's take is flawed too.

1. $50 collected in revenue does not mean $50 in profit. There's cost of goods sold on every transaction. The unlimited number of payments that she refers to doesn't quite work in the way she describes it.
2. Cash collected during the day must be counted, recorded and then deposited to the bank at the end of the day. The business has to deal with loss / theft and counting errors. As do the banks. There are still costs in doing this.

The major point is though… the banks take a cut of every digital transaction. Banks don’t take a cut of paper transactions…

No, she did not rewrite an Adam Smith book here, I get that.

 

[SexB]

I think that the only time I pay with cash any more is I'm going to see a provider or if I'm buying something below $5.

 

[explorerzip]

The major point is though… the banks take a cut of every digital transaction. Banks don’t take a cut of paper transactions…

Of course the banks take a cut of paper transactions. Small business accounts have monthly fees and a whole bunch of other conditions like limits on deposits, transactions, etc. They'll charge the business when they go past those limits too. Just a different way of looking at it.

 

[Kurt]

Restaurant Brand who owns Tim's, BK, Popeyes and other restaurant came out with a policy during covid that they would accept cash - that lasted for a week before they we slammed and threatened with fines by the Government. Some people use cash to avoid going into dept and it also discriminate against different groups - Young people, people with financial problems, Homeless. I was doing some work for them at the time and remember hearing about this and one Executive freakout and said everyone should have a debit card. How out of touch some people are.

 

[explorerzip]

Restaurant Brand who owns Tim's, BK, Popeyes and other restaurant came out with a policy during covid that they would not accept cash - that lasted for a week before they we slammed and threatened with fines by the Government. Some people use cash to avoid going into dept and it also discriminate against different groups - Young people, people with financial problems, Homeless. I was doing some work for them at the time and remember hearing about this and one Executive freakout and said everyone should have a debit card. How out of touch some people are.

Fixed your post. It is a stupid policy not to accept cash though. I'm sure they said the policy was "out of an abundance of caution", but more like the executives being paranoid of a very small risk. I guess it is theoretically possible to transmit covid or other things by coughing on your hands, then touching money, handing the money to another person, who then touches their face. That has to be an extremely small risk though.

 

[Jenesis]

Restaurant Brand who owns Tim's, BK, Popeyes and other restaurant came out with a policy during covid that they would accept cash - that lasted for a week before they we slammed and threatened with fines by the Government. Some people use cash to avoid going into dept and it also discriminate against different groups - Young people, people with financial problems, Homeless. I was doing some work for them at the time and remember hearing about this and one Executive freakout and said everyone should have a debit card. How out of touch some people are.

Same with assuming everyone could just get internet for their kids home school or assuming that everyone had phones for ArriveCan or vaccine QR codes.

 

[bazokajoe]

As silly as it is, lots of businesses during the first wave of covid stressed they preferred debit/credit for the reason stated above. The gas station around the corner from me absolutely refused cash to the point of locking the doors and customers forced to pay at pump.

 

[poker]

Of course the banks take a cut of paper transactions. Small business accounts have monthly fees and a whole bunch of other conditions like limits on deposits, transactions, etc. They'll charge the business when they go past those limits too. Just a different way of looking at it.

Those fees you are describing happen regardless of how the transactions occur. Cash or card. They Are on top of the actual transaction fees associated with using your bank card.

 

[explorerzip]

Those fees you are describing happen regardless of how the transactions occur. Cash or card. They Are on top of the actual transaction fees associated with using your bank card.

I was referring to the fees that the business incurs, which are different than what the individual faces. Businesses have the monthly fee on the account, a set number of transactions each month and additional fees if they go over that limit. Those fees are much higher than an individual.

They're technically isn't any transaction fee when a business accepts cash, but what I listed function as if they were. They just pay them monthly instead at every transaction. So that doesn't necessarily make accepting cash better than accepting cards. There's a whole bunch of hidden fees that customers are not aware of.