Credit card acceptance is essential for SMBs
June 17, 2013

Small- and medium-sized businesses understand why providing numerous purchasing methods at the point-of-sale is important to increasing revenue. A study found electronic payment systems that accept credit card payments not only improve customer satisfaction, but offer significant benefits for SMBs. Providing several options for customers to buy products or services at the POS allows SMBs to ensure each customer is able to utilize their preferred payment method. For SMBs that allow consumers to prepay for goods, the revenue gains are even higher.

Accepting plastic boosts sales 
According to, a study by MasterCard and Kaiser Associates found consumers who reach for their debit or credit card at the POS increase the retailer's revenue. SMBs that offer customers the ability to prepay for products or services see even greater sales benefits than their cash-only counterparts. In fact, the study found customers who are able to pay for items online or before receiving the product increase their spending than if they were unable to prepay. 

Ed Downs, senior business leader for U.S. commercial products for MasterCard, said SMBs that do not accept plastic at the POS may be unaware of the benefits of offering customers the option.

"Supplier acceptance is largely hindered by an education gap," Downs said. "We have found that many merchants are just not aware of the financial benefits of card acceptance but are willing to increase acceptance if presented a business case demonstrating the value. This research provides that business case."

By allowing consumers to purchase products before they receive the item or service, SMBs ensure they receive compensation. Credit card acceptance is crucial for companies looking to increase their reimbursement rate and offers payment security.

The study found card acceptance costs 37 percent less than other forms of payment collection, correlating to savings of $12 for a $500 transaction.

In addition to ensuring companies receive payments immediately, early payments reduce borrowing costs, helping SMBs maintain a healthy credit score, according to the study.

For B2B companies, there are additional benefits associated with accepting credit cards. Instead of having to bill the business to receive compensation, SMBs are able to be reimbursed early through prepayment methods. There is a significant risk of asking for reimbursement after a product or a service has been delivered. The business may not be financially stable and be unable to pay, leaving SMBs unable to receive compensation. 

Accepting plastic before and at the POS allows SMBs to ensure they are reimbursed and allows them to reduce costs. 

Nexus: G-WEBCD2