Did you know that more and more consumers prefer to use credit cards instead of cash? At least during the pandemic, the preferred payment method is no longer cash, according to a survey. This is why businesses must start accepting credit card payments online and offering alternative forms of payment overall.
Of those surveyed, 26% use less cash after the pandemic; only 18% expect to increase the use of cash while 27% of consumers surveyed believe they will use credit and debit cards more.
Just as payment industry trends indicate, these survey responses demonstrate that there is a great possibility that credit or debit card use may increase in the future and contactless payments can benefit high-risk businesses. In fact, amidst the ongoing COVID-19 pandemic, many respondents are optimistic that contactless payments are safer and may help prevent the spread of the virus.
When consumers use credit cards, there is evidence that they focus more on the benefits of the product rather than the cost. As a matter of fact, credit card users were 28% better at recalling aspects that are related to the benefits of the product when compared to cash users, who were better at recalling the cost.
By offering consumers several payment options – from ACH payment processing and credit cards over the phone to online payment portals or cryptocurrency – you allow your customers to focus more on the quality of your products or services as a low or high-risk merchant rather than how much they cost. Partnering with a reliable payment processing company can make it easier to achieve that payment flexibility for your customers.
When purchases are grouped, particularly on a credit card statement, the number of individual transactions becomes smaller, which, psychologically, makes consumers feel as if they’re not making as many purchases.
This idea is related to a psychological concept known as coupling, which depicts essentially how much the product’s purchase is connected to the actual payment.
Carrying cash around is not at all safe, unlike credit cards that are more resilient as they offer more protection than cash substitutes. The credit card security code matters in online shopping because it lowers the risk of fraud.
With credit cards, there are a lot of options when it comes to a refund or exchange, which can also help your business avoid the consequences of too many chargebacks.
Credit cards offer benefits and rewards in every transaction that are often not available if you’re paying with cash. Some of these bonuses include, most notably, airline miles and cash back on purchases. People are more likely to use their credit cards to obtain these perks, so it’s important that you offer them payment portals to accommodate them.
It is easy to track credit card purchases through the bank or credit institution that keeps records of credit card activity while cash is more difficult to track unless a person is diligent in notating all cash transactions.
As a business, credit card transactions can help you keep track of sales and there’s a lower risk that an employee miscounted the register, which could affect projections of future sales if it happens often.
Reports show a growth of 10.2% in credit card payments, which is a contributing factor in the rise of consumers shopping online. That being said, it is important to note that the method of payment could greatly affect spending habits unless they are closely monitored.
While cash has a tangible value attached that makes people think twice before spending it, credit cards, contactless payments, and peer-to-peer transactions like Venmo are more abstract; people can’t “see” it and don’t have to pay until later, so they are likely to spend more money as a result.
This doesn’t take away from the advantages and convenience of using credit cards instead of cash; it just means that consumers should be more mindful of their credit card usage, taking care not to overspend by tracking their expenses.