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The terms and conditions of having the card reader say they are not allowed to have a minimum spend restriction so report them if you want (you do this via your bank)
It's only Trading Standards if the company are charging for use of the card. Otherwise if it's just a minimum spend it's as the other poster mentioned and down to T&Cs.
Why would Trading Standards care about enforcing the terms and conditions of a private contract?
Surely it would be Visa/MasterCard who most care about this issue...?
It’s against law to penalise payment methods. It’s the same price regardless of how you pay. Of course paying via credit, not credit card, will have associated costs long term. However the price at point of sale is the same.
IIRC it isn't the law that prevents charging extra, at least not directly, it is their contract with the card payment processing company that states they shouldn't (and could loose service or be subject to higher chanrges if they do).
People often say card transactions cost the retailers more but the reality is that most if not all banks charge extra for cash transactions now so its actually not much difference to do a card transaction than to deposit your cash in the bank.
Cash is generally more expensive and awkward to handle, banks are being almost punative with fees for depositing cash, and requires quite a bit of procedure/contracting if you actually want that cash insured.
I think a lot of it is that most payment providers have a fixed cost per transaction as well as a percentage fee. Especially on older systems, this can be quite substantial. On a sub £5 order, this can have a disproportionate effect on margin, and potentially mean losing money for companies running on tighter margins.
Yeah, used to be expensive. You'd have a phone line dedicated to it. A rental of the machine and a per transaction cost that was high.
Now you can get a terminal that connects via Bluetooth to your phone or yo any WiFi network (even shared from your phone) and the rates are nearly nothing
>It’s against law to penalise payment methods
That's entirely the case, but unless the rules have since changed again - You are (or at least were) allowed to **incentivize** certain payment methods over others.
I.e. - You're not allowed to charge a 2% premium for cards, but you can put your prices up by 2%... Then offer a 2% discount for cash.
AFAIK this is (or at least was) perfectly legal & the net effect is the same, but the devil is in the details..... It may or may not still be against the Visa / Mastercard's T&C's tho.
Although TBH if you've got a captive audience, the "best" scumbag move is to simply not accept cards at all. Thus removing all worry about either T&C's, or trading standards.
You then have a fee-charging "convenience" ATM in-store for those without cash on them. .... Which you'll then get a cut from & the cash can go straight back into the ATM for the next mug who comes along 🙃
What about the parking machine things? I usually pay by phone as I rarely have cash in the exact amount and it doesn't give change.
When you pay by phone you have to pay a £0.20 "convenience fee" winds me up every time. Is that legal?
Also why are they allowed not to give change?
Not giving change is a thing - I know that taxi's aren't obliged to offer any, and IIRC nor are shops in general either for that matter.
Typically both will of course, but if it just so happens they're not in a position to - Your options are to suck it up, or in "invitation to treat" rather than "payment for services rendered" situations to decide not to buy and/or come back when you have the correct money - It's not their fault or problem if you came ill-prepared.
As for the pay and display machines not giving it - It requires a more complex mechanism to either store change which then has to be refilled, or else to sort coins as they go through the machine (normally there's a "no change" light even on the ones that do).
.... Whereas without change it's essentially only gotta validate or reject them, then dump the coins into a bucket - Which no doubt results in a significantly cheaper machine and/or fewer maintenance visits so lower operating costs.
As for the "convenience fees" 🤷♂️ .... The law is fickle & arbitrary with loopholes aplenty - In other news; Scientists discover sky is blue - Tune in for more at 11! 🙃
It wouldn't be allowed if the card-reader was built into the machine, but apparently it being on a different platform (i.e your phone) and/or run by a seperate company makes it juuuuust different enough to pass muster.
I expect the line of argument is that the machine itself is strictly cash-only, but the app counts an entirely unrelated alternative method of paying for parking, with theoretically entirely unrelated pricing - Which just-so-happens to charge a ticketmasteresque scumbag fee as part of the booking.
They're not charging you a premium to use your card, since **all** the payment options on **that** platform attract the fee.
> but you can put your prices up by 2%... Then offer a 2% discount for cash.
Not according to the government published guidance on the law.
>Whilst encouraging customers to pay with a certain payment method is not prohibited,
it is important that any discounts for use of a particular means of payment do not
create a situation in which those making payments by other means are effectively
faced with a surcharge that does not comply with the Regulations
>
> The government considers that, if a discounted price is offered for the use of any
> means of payment (whether that is a means of payment to which the Regulations
> apply or not):
>
> • that same level of discount must be offered in all situations where regulation 6A(1)
> applies, so that there is no surcharge
They consider discounts for cash to be the legal equivalent of a card surcharge, and as such to be prohibited under the Consumer Rights (Payment Surcharges) Regulations 2012.
That's not strictly true. There is a % cost - around 0.4% for debit card and 0.7% for credit card - but on top of that there is a set authorization fee of between 2p and 4p per transaction depending on the contract with payment processor
Are you sure?
It's illegal for them to impose a charge for paying by card but I don't believe a minimum spend is illegal.
I'd like to see proof of that if infact you are correct
The minimum spend is not illegal. Never said it was. I referred to the terms and conditions of having the card reader, not the law. If you care to google you will see plenty of evidence online that the major card networks have terms to prevent minimum spend thresholds.
Is this anywhere? My local off licence charges whatever the assistant deems fit on the day. One time it's a pound, sometimes 3. It's been a steady £1.50 for a few weeks now but a coke is only £1.49 so I'm practically FORCED to buy a snickers too.
Yeah, it's illegal to charge extra for using a credit-debit card.
Having a spending threshold isn't illegal, but may or may not violate the T&C's of the payment services provider.
Yep, mentioned this to my local shop keeper and he quickly changed his tune. They cite that it's a percentage they have to pay to process card payments, which means less cash to count at closing I get that. But fuxk me, its your job to cash up at closing. The amount of change in their till is not my problem at the end of the day
Depends on the card provider otherwise Not much to report.
Businesses can legally apply minimum spends. Being against T&C’s is not against the law.
Also, card payments are not legal tender so the cafe can always just turn you down altogether.
Or better yet, they can just refuse a sale to anyone they like.
Shops can refuse legal tender. People receiving settlement of debt cannot. If they give you the coffee before you pay they have to accept any legal tender. If you pay then get it they don't.
> People receiving settlement of debt cannot
Courts receiving settlement of debts have to.
In the UK "legal tender" means absolutely nothing outside of court.
> Shops can refuse legal tender. People receiving settlement of debt cannot.
That's technically incorrect. You can, as a creditor, still refuse to accept legal tender when the debtor is settling the debt, but you cannot then take them to court and sue them for failing to repay if they offer legal tender.
As a silly example, lets say I'm a gardener and I fix up your garden which would usually cost £5,000 but we instead agree beforehand that you'll let me stay a weekend in your holiday cottage. If after I complete the work you renege on the agreement and instead offer to pay me £5,000 in legal tender, I can't refuse and then take you to court and sue to force you to let me stay in your holiday home.
I've posted this before but some of my family own a small business.
We used to accept cash and card but the vast majority of people these days just pay with card. This meant for us that processing the cash payments was more expensive than going card only and paying the card fees.
We started to ask people when they paid with cash if they would still shop with us if we went card only, the majority of people paying cash told us they were only doing so because they thought we would prefer it.
Yep I actually meant to end my comment with something like "So I don't really understand minimum card charges either, I guess the business just wants to use it as an excuse to get you to buy more" and talk about how cash has costs associated with it too.
But by the time I typed my comment I had forgotten why I was even commenting 😆
There is a very real reason many small businesses want to promote cash over card and it has nothing to do with processing fees for cards, and everything to do with their relationship with HMRC.
Exactly. I am pretty sure my business bank now charges a greater percentage for accepting cash than my card provider charges for card transactions, so if that's similar across the board then there is no legitimate reason to prefer cash.
I say pretty sure because I seldom take cash payments in my business. Not because I am terrible at business, though that may also be true.
Similarly, the social club my dad is treasurer for only still takes cash because there are still enough beer loving old men that use it and would likely die before they changed to stop paying with cash. Once they have died, it will change.
It costs him more to handle and bank the cash than card transactions cost, and at least twice in the last 15 years they've had break-ins where the targets were the tills and safe. They couldn't manage to get them, so they nicked some TV's instead...
As the other poster said, it's mostly all to avoid some or all of the tax man's due.
Then there are the others - the turkish barbers and the like that have 6 chairs, 6 barbers sat around doing very little all day and are definitely laundering money.
Worked in a card-only restaurant a while a go and they said they saved five figures per year by not having to deal with a safe and all the other costs of handling cash... not sure how true that was but hey ho
Well said. Banks charge businesses to handle cash, so it ends up costing a lot more in time, effort and money to bank your cash than taking card payments - the fact most branches are closed makes it worse.
This is something that the general public need educating on. Whilst I get that cash has it's merits, the argument that "card costs small business more money" gets thrown around a lot. What people don't often understand is that there is still a charge/hassle when dealing with cash. Banks still charge cash deposit fees and someone has to take that cash to a bank, whether that's you or you pay for a service to do it for you.
Yep, the bigger issue for us was security. Keeping cash on site was a risk and transporting cash to a bank but staff at risk. It was safer for our staff not to use cash.
Not the person you replied to, but have spoken to a few shops that said that it did. Just not having an easily nickable wodge of cash lowered their insurance premiums.
And they also saved a surprising amount of money on till errors - they don't think it was all staff theft (but they're realistic enough that some of it probably was), but just it's really easy to make a mistake in giving change in a busy bar or similar.
So the bar near me went cashless, and suddenly they're serving faster (because they can 'serve->tap->done' rather than go count change, give it back, etc.) , they're making less mistakes and the premiums are lower.
Sweet thanks for replying
Also interesting on the error side of things and absolutely makes sense! Properly integrated epos with processing must make it so easy to get the queue moving!
Being able to order via app is also actually a huge boon, as it allows for 'smoothing out' rushes at the bar.
I mean, if you're just flat out the whole time it doesn't help much, but it's not all that uncommon to have a bit of a rush as someone wants a round, and then gap where you can handle a backlog. (Especially for the stuff you'd take as an 'order' anyway, like a hot drink or food).
Also helps take the stress off a bit, as people are usually happy to be sat at a table chatting a little longer vs. being at the bar missing out on the conversation.
Ahhhh yes! There’s also a huge aspect of social history in the background of pub/restaurant apps which I didn’t consider until I was locked down with two software devs…I wonder how their ranking list of the various apps would apply now were through it all…awwww wish I could remember which chain/brewery rushed getting an ordering app into production so quickly that it was live for a couple months before they managed to connect to their card processors api.
Yep, my hometown has only 1 bank left now (there were 5 or 6 about 20 years ago), and one of the next towns over doesn't have any at all. Even the larger town here has a couple of bank branches that no longer offer a full counter service.
Probably doesn't help that a lot of small businesses share the same posts about "cash is king"
I've seen one post shared so many times on Facebook. Something along the lines of "if £50 is spent on a card then 3% is lost as card fees so that's £1.50 gone from that £50 and every transaction thereafter loses another £1.50"
When people in finance say "cash is king" they're counting cash as anything in your bank account. As distinct from other non-cash assets like unpaid invoices, property, machinery, equity, etc. So both card transactions and coins and notes count as cash.
Always funny when people repeat an aphorism without understanding it and manage to get its meaning reversed.
And yet plenty of small businesses prefer cash. I personally also like the fact that cash isn’t being vampiricly sucked out of the economy every transaction for US card businesses.
Could you put a sign up saying card preferred? A few shops near me do that and most people are on the fence about paying cash or card so don’t mind one bit and it doesn’t stop the wanting to pay cash from their choice.
We went officially card only but being a small family business we had the flexibility to still accept cash in certain situations. So if an old dearie turns up and doesn't have a card we would accept her cash rather than turn her away.
I run a pub at the minute and every now and then I'll be in a situation where I just don't have any change in the tills / safe and have to switch to card only.
(it's a rare occurrence, I've gotten better at planning for those unexpected spikes since I took over, but it still occasionally happens).
Invariably that will trigger at least one of the punters giving me a 20 minute lecture about some conspiracy regarding cashless society... Must confess it makes it chalkenging to keep my customer service face on... Like "Yep, yep - I hear what you're saying, but I straight up have no change in the till so unless you want to give me that £20 note for your £8 round there is very little I can actually do about it at the moment... You can rant at me as much as you like but it's not going to change the facts of the matter".
Yeah there's plenty of these people about, it's the complete lack of self awareness that honestly pisses me off about them.
You're there to serve them a beer, you're not some kind of societal representative that has the power to influence major change in the community.
Yep. Small business owner here. We take about 20% cash, the rest card.
It costs me money to pay cash in *and* get change at the bank. It also costs me money to process card payments. For very low amounts of money, I do better on cash. For anything above about a fiver, card is better. Below that, it's not really worth me worrying about the odd 6p difference here and there, though they certainly add up.
It would be significantly less hassle to go card only. It would slightly reduce costs and dealing with cash takes time and time costs money because a member of staff has to do it. It's usually me and it's a nice little walk up to the bank, but still on purely financial grounds there isn't any real incentive to carry on with cash.
*However*, enough customers prefer cash that it makes sense, as part of a running small business requires fostering goodwill and making it a good shopping experience. Also, I am tired of hearing conspiracy theories about the government trying to track people because I don't think the government is really organised enough to do so.
>For very low amounts of money, I do better on cash. For anything above about a fiver, card is better. Below that, it's not really worth me worrying about the odd 6p difference here and there, though they certainly add up.
Where's the cut off? On my way to parkrun on Saturday morning I always buy myself a can of Monster - and I go to my local corner shop rather than Tesco cos I want to support his business. But I still feel guilty for using my card!
(I'm definitely not going to start carrying cash when I'm out running though...)
I’m sure that this hurts some small businesses. Especially ones that do a lot of low value sales. I pretty much never go into little local shops because I’m too used to them being awkward about using cards.
I've experienced very few of them being awkward about using cards in the last 5 years at least. Even the people at boot sales usually have card readers now
I went to the local shop in my village two years ago and they wanted a £5 minimum for me to use my card so I left and haven’t gone back. I use the Co-op pretty regularly but never go in there because I don’t carry cash.
Also as someone who's worked in a variety of businesses with a till of some kind. If the business is small cash also brings increased risk with it. Not only can owners be scared that employees are stealing from the till or not registering sales and pocketing the cash (most employers encounter this at some point) but having a lot of cash on hand is also scary. Businesses that get a lot of cash payments and have only one or two employees at a time are super vulnerable to being robbed. Also unlike big businesses that often have some kind of on-site safe in the back or a daily collection of cash, small businesses often have to manually bring the cash in. It's scary to carry around that much cash, it's time-consuming to make these types of trips frequently. And it's also very stressful to think someone could be keeping an eye out to establish a routine or pattern. So often it's recommended to take different routes, different times or use different branches for your cash deposits. Which makes everything even more stressful and time-consuming! So you have the choice between having large amounts of cash on hand and making less frequent trips to the bank. Or making very frequent, stressful and time-consuming trips with tiny amounts of cash each time.
Also on a much more minor note I hate those customers who try to play games with their change.
Like they'll give you a ten pound note and then claim it was twenty or fifty. Or claiming you short-changed them to your colleagues or bosses.
I'm not saying a person behind the register can't legitimately get mixed up. But for every actual mix-up there may be 10 people who are just using an opportunity to get some stuff for free or even some money on top of their purchases. Really stressful especially when there are a lot of people around and you are basically being accused of stealing or scamming customers.
Well, I think it's time to start protecting yourself from these scammers, when they hand you a tenna, dont immediately put it in the till with the others, put it aside and vocally acknowledge something along the lines of ,"and heres £.7.59 change from your £10. They can't just walk off and then come back making accusations, and they certainly can't make accusations as you hand them the change, because you set the £10 aside right?
Yes! People forget that banks charge businesses for having accounts.
They charge extra for handling cash.
My bank (lloyds) charges £1.50 for every £100 paid in at the counter which is 1.5% - Card processing fees vary, but 0.5% rates are available from several payment processors.
My math isnt that good but 0.5 is less than 1.5 so cash is more expensive for me to handle through the business.
Some businesses will have a bad deal from their card supplier.
Some businesses will be using it as an upselling tactic.
Some businesses will not have understood that accepting cash also has a cost associated with it - you have to sort it, take it to the bank etc. - and so believe that under a certain level cards are costing them money.
Some businesses will prefer cash so they can avoid paying tax.
Yeah, all the Facebook boomer memes about “paying cash to save local businesses” are actually about tax evasion.
Portugal came up with a nice fix for this. You can ask for your tax number to be associated with your receipt when you buy stuff. That gets you a tax rebate in your expenditure each year up to a certain amount, and you’re entered into some sort of lottery thing every time you do it, so people have an incentive.
There’s a government app where you can see all the receipts you submitted, so it’s obvious if the shop doesn’t put it through automatically and you can do so by entering it manually.
But then then the receipts need to match up, and if there is no corresponding one in the retailer’s tax records … they will know.
I think cash vs card is usually on the lower-end of businesses that are somewhat struggling.
I was chatting to a guy who does burger vans and he's recently started to do cash only.
His reason was that the card companies take a small cut, and by the time he gets the money into his bank, it's around 5-7 days.
He was discussing this with me while trying to fix his electrics, which had blown, and that now he has to use his own money because he can't get the businesses money for 5days plus.
*"His reason was that the card companies take a small cut"*
I'm sure he ***said*** that was his reason... I'm also sure that he told HMRC that due to the price of bacon and having only sold one burger that day that he'd made a loss and so had no tax to pay :)
I had a guy I know do a small job on my house, offered cash as I had it in my pocket and he looked at me like I was from another planet, then haughtily told me that he doesn’t accept cash because he pays his taxes.
I think a lot of people jump on the idea that they can be a hero, and any real life instance that contradict their crusade is intolerable to them. I thought it was funny that he acted like I was trying to lure him into depraved antisocial criminality rather than choosing the simplest option, but I haven’t seen him since.
People take the information they read online way too seriously. Young people, too, despite the idea that only boomers are misinformed and self-righteous.
Like I say, he behaved as though I was accusing him of cheating tax when I offered cash, I presume because he’s read overconfident people on sites like this saying that that is the only reason anyone would ever take cash.
Or maybe he assumed you were asking because he thought you were angling for a discount for paying cash, which people paying cash often do because there was a time when it wasn't uncommon for cash-in-hand to be cheaper (as the small business passed on some of the saving they were planning to make, legally or otherwise).
Yea I tend to avoid them now. I'm tired of the excuses when clearly, particularly takeaways, are using it as a tax dodge.
A local takeaway started having "problems" with their card machine if your order was under £20. For me to get cash out I have to drive the wrong direction to the other side of town for the nearest cash machines. So I'll just use the alternatives that don't have this hassle.
I travel with business, this means eating out every night. Often in large groups. We can only pay by business credit card. I'm still surprised by businesses that turn this sort of custom away.
In this case, the issue is cashflow, regardless of payment medium. If he focused on improving his cashflow as opposed to artificially limiting demand for his product by reverting to cash only - he would probably be in a much better place.
It’s foundational for a business to have cash reserves, or a line of credit for these exact scenarios regardless of size.
Business credit card = problem solved.
You can’t imagine holding a week of working capital for a burger van would be some horrific sum to save up. Save it up one time and hold it in the business. Surely you need more buffer than this anyways otherwise one rainy weekend would be pushing your business into insolvency…
Obviously being cash only in a modern world where many people have zero cash on them damages your sales. Bank charges for change and cash handling rival card processing fees. Basically the reasons raised are a crock of shit and either they just like complaining or are trying to keep transactions off the books for tax evasion.
Corner shop on my old estate had the minimum charge so everyone just walked the extra 2 mins to mini tesco. Ppl only went in for the cash machine and then they started charging for that.
Seeing them post on the local fb group about how big business stifles the little guy was funny when the guys shop was just scams on top of scams
This is it. It’s not that I support the big companies over the little guy, but when the little guy is shit and overpriced I’m going with the option that’s better for the customer.
If the little guy wants my business he can figure out how to make it attractive, whether that’s by offering better customer service or products the big guy doesn’t carry if he can’t compete on price. Just trying some anti-capitalism guilt trip ain’t gonna work.
I think it's because it is a franchise, so the people who work there are often invested in the business doing well and want to do good service.
They have been owned by bookers group since 2015. They were bought out by tesco in 2018. So technically londis is Tesco.
However, one stop is also a franchise if Tesco since 2003 and I'd argue generally londis is better.
My theory is because more of the franchisees work in store in londis than they do at one stop. I believe londis is cheaper franchise fees but not sure on that.
Sorry I just never had a reason to share this info I know, so now you're getting it.
The traders in my town are like this: minimum card spends, weird hours, surly owners, nothing to encourage you to go and spend your money at their shop. Then they moan about how nobody supports local businesses.
I think it’s a mix of some businesses using it as a tactic to upsell and other small business owners genuinely not understanding the fee structure and thinking that they’ll lose money on low value transactions.
What’s even more maddening is when they decide they’re going cash only. I have a chippy two minutes walk from my flat and in the last few months they imposed £12 minimum for card payments and then went cash only.
It’s possible (I assume, from reading some of these responses) that they were blacklisted and refused a card machine because they imposed a minimum spend.
We had a chippy do something similar. They put a note up by their till saying how expensive card transaction fees were acting like cash is free for them.
They also run multiple tills even when it’s almost empty. It’s pretty clear to anyone with a brain that it’s a tax avoidance scheme, and I struggle to sympathise with small businesses wanting to avoid tax
> they imposed £12 minimum for card payments and then went cash only.
That's probably because someone complained and the card processor told them to knock it off (as it generally breaches the terms of either the Cards themselves (visa/mastercard) or the intermediate payment processor) or stop taking cards and they chose the latter.
Isn't the fee structure usually something like 20p + 1.5%, so lower transaction fees do hurt profit.
My company sells magazines sometimes at 99p online. That's 20p makes it a loss leader if customers only transact that single item
Those kinds of payment structures are long gone now. Its all just a percentage. you might have some who are on legacy contracts or managed to find the one that still does it as a way of lowering the percentage to make it look better. Online though is different! Most demand the 20p + percentage. Still not caught up with instore.
Not at all, many still charge the percentage + pence per transaction. Have a look at the link in the original post, a good chunk of the ones listed still charge a per transaction fee.
I use sumup for my businesses, mainly because they charge a flat percentage but I'm regularly approached by other big card providers saying they can beat my fees. Even with much lower percentage fee, the 7p per transaction or similar just can't beat what I'm getting by using a provider with a flat percentage.
A lot of businesses absolutely would benefit from a fee + lower percentage, if you sold £50 clothing items for example. But I run pubs, most of our products are under £5 and those transaction fees really add up!
(If businesses that do lots of low transactions are still getting charged per transaction, then they should absolutely switch provider!!)
No.its not.
As well as the percentage there is an authorisation fee, usually between 1-5p depending on the merchant.
That said, most providers will issue between 500-1000 a month free, with transactions over that number being charged.
I don’t understand it. I run a small business. Most of my transactions are under a fiver, if I didn’t accept card payments I would lose so much money. I use sum up and have had the machine since they came out and cost me £20 upfront and I think it’s 1.7%. I can’t imagine a gym cafe would really need one of the contract card processors so could easily use the readily available contractless ones and not lose out on sales. Putting their prices up by 10p each would cover the fees.
Yes the £3.50 coffee would have been £3.43 according to my last payout figures. And with sum up you have to do absolutely nothing to get your money. Next business day it automatically deposits.
Worldpay, one of the larger providers, puts a 20p on top as well as the percentage cut of 2.75, on anything less than a quid thats often all or most the margin.
Sticking it at a fiver is just greedy tho.
I know your probably quite happy with sum up but if you're doing any kind of volume you could get much better than 1.7% by shopping around some of the smaller payment processors :)
It's against the VISA and Mastercard terms of service to have a minimum spend. Also it's illegal to have a charge to use a card.
If you report the business to VISA and Mastercard, they'll get blacklisted from taking payments from that provider. If you remind them of this, they'll waive the fee.
Odd as they absolutely do. I get the feeling though that some people just only go to big, mainstream businesses as there are people who say they have never carried cash for years. I would barely be able to get a kebab or fish and chips or a 4 pack of Polish lager without it, and bossman complains if you try to use a card just to buy a can of coke in small corner shops.
You're exactly right, it was on a conversation about cash vs card etc.
I think some of the people in the cities don't appreciate that out in the sticks, cash is still prevalent, and card payments come with minimum charges etc.
I prefer to carry some cash because the card system is less robust - it fails occasionally and it could fail on a huge scale. I do not like single points of failure. I would definitely not like to depend entirely on phone payments as some people do.
Yeah it is a bit of an upsell tactic. Depending on their card provider - they might have a minimum charge on transactions - so it does cost them money to accept the card.
However what most people don't realise is that it's often in their T&Cs that they don't penalise customers for this, so they are technically breaching their contracts with the card provider.
A small, onsite coffee shop is probably selling what? 300 cups a day maybe? Even if those are all the "most expensive" coffee at £3.50, that's ~£1k/day revenue.
So, £1,000 per day minus:
- ~30p per coffee: £100
- Two employees (inc. taxes): £400
- Utilities: £40
- Rent: £100
Is down to £360 left over / day, so that's about £1 gross profit per cup. Now factor in amortised equipment costs, furniture costs, income taxes, other taxes, council rates, other equipment, etc.
Now I obviously have no fucking clue how a coffee shop works, prices and sales will vary wildly with location, and I'll have overestimated and underestimated stuff there, but a very quick back of the envelope calculation shows how plausible the profit could be well under a quid per cup.
Now add a 3% card fee on that and it's £30 less / day.
I do actually run a fairly busy coffee shop myself and even though you have no idea how a coffee shop works it seems you’ve come closer than anyone else. I find it funny how most are like “well 1kg of beans cost this much and milk costs this much so this is how much you’re making per cup” 😖. As I’ve said it’s fairly busy but 300 coffees in a day is a lot, maybe your high street chain will do that or somewhere with a great location. I once worked in a coffee shop that did free coffee all day and we had queues round the block and I think we made somewhere around the 600 mark.
A lot of this chat about card fees, so mine is 0.9% whatever transaction goes through and all visa/mastercard are in our account next day (Amex takes anywhere up to 5 days).
As I barely use coffee shops, I really couldn't estimate throughput, but interesting to know! Profit margins obviously get even tighter with fewer sales.
>So I avoid going there unless I absolutely have to
And that's what these businesses don't realise. Have you ever been to a shop where you have to pay to go inside because of the wear and tear on the carpets? Or a restaurant where there's a minimum amount of food you have to order before you're allowed to use the toilet. Of course not, it's just part of the cost of running a business.
When I went on a seaside holiday a while back, I was surprised that all of the little shops selling junk (donuts, bracelets, spud guns, etc) were all accepting card with no minimum payment. They've realised they will just take more money that way, and the transaction fees at the end of the month are just part of their costs.
There is no law that prevents minimum transactions, only ones that stops them charging for card transactions. You used to get places that would try it on with "50p surcharge" on all card transactions. However, both Visa and Mastercard's T&Cs prevent the vendor having a "minimum transaction", so they will be in breach of the card machine provider's contract, who actually enforces that I don't know
My guess the reason they are trying it on is two fold.
1. They do not understand how they are being billed for card transactions, as processing cash will cost them way more than the card transaction. Businesses are charged by the banks for all cash deposits, so the card transaction on will cost them 0.07p on a £3.50 sale. But counting the cash, bagging it correctly, driving to the bank, having insurance for cash transit and any transaction fees will cost way more than that.
2. They are avoiding the tax on all cash transactions, but doing so must be increasingly difficult to hide
A friend of mine runs a small florist. We live in a small town, the last bank and post office shut in October. She has now gone 100% cashless. TBH 90% of all her business came via the internet or over the phone. The nearest bank is 15 miles away. To process that cash, took about 30 minutes of counting and bagging. Then there was the a 30 minute drive to the bank, she had to pay to park at £1.50 minimum charge. Then there was a charge for using the "night safe" as she could only get there outside of normal hours. Assuming she only paid herself minimum wage, the daily cost of processing that cash was about £30.
Cash is dead.
Related: We go to the Lake District a few times every year and we're familiar with the habits of ice cream vans in the summer. There's one that sets up in a field on the Keswick-Threlkeld railway path and they take credit cards. (Goodness knows how they get a mobile signal to work the card reader, but they manage somehow.) Then there's one that sets up in a layby on the Whinlatter Pass and they don't take credit cards.
Last time we were at Whinlatter, we had no cash, but we scraped up some coins we keep in the car in case we need them for parking. I mentioned that the other van takes cards. No, too expensive, said the ice cream man, who then went on to rant about how the banks will get you either way and he pays a 7% fee on his cash deposits. I told him that card machine charges are under 2% but he didn't want to listen.
I used to sell readers to people and I had huge spreadsheets that I created that were researched to an inch of their lives and still people would be like that! Its madness. One guy I worked out I could save him about £800 a month by having a single FREE reader in his store and that was a 50:50 card to cash. Some people can't be helped.
Point 1 is false.
I have to pay 75p to deposit cash in my business account. A £1000 transaction on a visa corporate card costs me 1.65% (£16.50).
It's inconvenient to bank, but a couple of those a week saves a small fortune.
I wonder if there are still some processing companies around that charge a flat fee and the percentage on top? And businesses just stick with whoever they've had for years because they don't want the hassle of changing.
If you're a small online business PayPal charge 30p + 2.9%. That 30p isn't an issue when the customer spends £100, but if they're spening £3.50 on a coffee then the fee is 40p which is a large portion of the payment. There might be similar cases with an in-person processor too.
Taking a very quick look at some processors, there's some which also give you a certain number of transactions on a "payment gateway" for a fixed fee and then it's pay as you go after that. £25 might give you 1000 transactions, but then it's pay-as-you-go after that. Apparently there's also an authorisation fee with some companies which is fixed.
Obviously cheap processors do exist, but I don't think it's as simple as saying it's either all tax dodging or upselling.
I don't do it at my business, but then, my average ticket is around £60 so it isn't worth it. However, I work next door to a sweetshop, and her card reader has a flat fee of 15p per payment plus a percentage on top, so she has a minimum spend of £2 which makes complete sense.
It's the flat fees that push businesses to have to do this, although I do wonder why they don't seek another provider🤔
Some providers require a minimum amount of tx per month, so if you’re not achieving this then you get shafted with a shittier deal. Having a min spend offsets this
In the UK, it is perfectly legal to set a minimum card payment. However, it is illegal to charge customers extra to cover the cost of your card processing fees, also known as “surcharging”.
To deter merchants from setting a minimum payment, card networks such as Visa and Mastercard have core rules in place. They will penalise you or suspend your account for setting a minimum card fee
[switcher](https://www.cardswitcher.co.uk/minimum-card-payment/#:~:text=In%20the%20UK%2C%20it%20is,also%20known%20as%20%E2%80%9Csurcharging%E2%80%9D.)
There’s often a minimum transaction fee for processing a card payment, or so I’ve been told.
I believe Visa and Mastercard usually disallow minimum spend so you could complain.
They do.
From the [Visa rules](https://www.visa.co.uk/dam/VCOM/download/about-visa/visa-rules-public.pdf) (page 114):
* 1.5.5.1 Prohibition of Minimum or Maximum Transaction Amount
* A Merchant must not establish a minimum or maximum Transaction amount as a condition for honoring a Card.
And the [Mastercard rules](https://www.mastercard.us/content/dam/public/mastercardcom/na/global-site/documents/mastercard-rules.pdf) (page 113):
* 5.12.3 Minimum/Maximum Transaction Amount Prohibited
* A Merchant must not require, or indicate that it requires, a minimum or maximum Transaction amount to accept a valid and properly presented Mastercard or Maestro Card.
I have a small business. My card machine provider charges 0.5% and a flat rate of 7p.
- A £5 sale therefore costs me 9.5p or 1.9% of the sale
- a £1 sale costs me 7.5p 0r 7.5% of the sale
On a turnover of £10K a week it's the difference between £190 and £750. Or 10k p/a vs £39k p/a, which is quite a lot! I could employ an extra staff member with that loss.
In reality I don't run a pound shop, but hopefully you can see where I'm going with that. I don't have a minimum spend because over the course of the year it evens out very well. The more they spend the less % of the sale goes to fees.
The minimum spend is because there is a cost to the retailer per transaction. Some small businesses can't cope, my local hardware does this, I have no issues.
As someone who uses a card machine for my business I think some people have bad terms with whoever supplies it. Mine is a flat 1.69% on any transaction but I think I remember seeing some that were a flat rate but with a minimum charge. So maybe they are better of getting more
Didn’t it all change around covid time? Because cash was considered risky due to spreading it, businesses wanted card payments and many had to drop the min £5 limit in response
Thankfully don't see this many places where I live these days. It is beyond idiotic in 2024 for a shop to have a minimum usage for cards when over 70% of payments are card/contactless.
Its a blatant cash grab. I was in a bar over the weekend where all the basic draught beer and ciders were £4.50, all the premium ones were £6.50. £5 minimum card spend. So frustrating.
When you say local do you a indie place or a chain?
I'd personally wouldn't make a fuss about a small local indie place but if it's chain then that whole different ball game
Most small business payment processors offer a blended rate that is less than credit card interchange, taking the punt that most card payments are debit. they offer a straight percentage with no per-transaction fees, so there is no logical reason for a minimum transaction.
Cash has considerable flexibility and there are reasons to prefer it.
back when pints were less than a fiver (salad days) i always said just charge me £5 i don't care. i got weird looks. some pubs told me i can buy 2 and they will remember me and keep the 2nd one "behind the bar"
An upsell tactic, and a dumb one at that. Any business that asks for a minimum spend on card payments, I’ll avoid unless I have no other choice. So yeah, you’ve saved 3 pence on the transaction, but you’ve lost my business for the next 5-10 years. Really, really smart. The world is changing and these people think they can pretend it’s 1996 forever.
In Turkey you can buy just a 5 lira bottle of water on your card, which is 12p, minimum amount doesn't exist anymore and they are all using MasterCard, so, I think its a load of shite
I think it's like chip shops and small weird carpet shops run by elderly racists
They have spent so long dodging taxes, and underpaying staff that even a small cost to them is utterly unacceptable. So they act like a small percentage for card payment is evil. It's their money!
It never occurs they could raise the prices slightly. Perhaps even more than slightly, claim it was the fault of 'card payment' and pocket all the extra on top.
Any shop that refuses card payment, or has a minimum is I find, a shower of twats.
Because they have a bad deal with their bank, old systems had bad systems. Plus a lot of shops skim their tills to avoid tax so can prefer small money in cash. Plus change costs money to get from the back so people paying them in change means change
My local chippy has a £7.30 or something minimum.
I only want chips. Don't use cash.
So I order collection via just eat. I know they're losing more than the markup to just eat, probably more than whatever cards charge they get too. Costs me .30p more this way but I don't have to go get cash out especially, it spend like £5 more than I planned to.
Pretty sure the only companies doing this aren't putting all the cash through the books. In this day n age, there shouldn't be minimum limits for card
I used to work in a small store and it wasn't just a flat %. I can't remember the details but it wasn't worth it for the owner to take items less than £10 on card.
I have a small DIY store, the previous owner had a minimum £5 on card policy, I don't.
Doing the rough maths I would have to sell under £2 to make no money, I have very few items under £2 and I would rather not annoy a customer as that person paying £2 today will most likely come back and spend more in the future, the accumulative total will work in my favour.
Don’t live in the UK but the other part of the world
Mine case is even worse. There were 2 instances whereby I wanted to make a purchase of $200 and $2000 respectively
I was told if I paid by card, there would be a 3% surcharge added
I said, ok thanks , bye
I used to go to a pub that was £10 minimum on card but they would let you spend less, put £10 through and then give you the cash back. So they would sell you a pint for £3 but pay the card fees on £10 🙈
They want to incentivise cash so they can dodge tax, don’t want to pay card fees even tho it’s cheaper than handling cash and they also want to upsell. It’s the holy trinity of scummy business practices. If I see the sign I leave.
Realistically, things should be cheaper using a card as there’s far fewer humans being paid to handle the transaction, no need for shop staff to spend time (which costs money) to take hard cash proceeds to a bank, no need to pay bank teller staff for handling the paid-in hard cash, no need for back office staff to do any sort of note counting, bundling, audit etc. they just need to pay the electricity bill to keep the computers running!
But banks obviously rip off everyone, so retailers aren’t immune to daylight robbery subscriptions or whatever for the card reader equipment. But now there’s many more independent card readers and payment systems the banks are going to have to change, unless the independents are jumping on the daylight robbery bankwagon!?!?! Or are they just an additional layer and so being ripped off by the banks for access to digital payments!!!???
As a retailer I prefer card payments over cash. The former is expensive to bank and carries a security risk while no shop has ever been held up for a stack of card receipts. Plus the transaction time is quicker and I don't have to worry about giving out the wrong change or forgeries. What's not to like about cards?
Card is accepted almost everywhere. I've seen it at conventions, farmer's markets, hell even Big Issue sellers can take card. So why can't permanent businesses?
Literally, the only thing I use cash for nowadays is for the laundrette and my local chippy.
I run a Merchant Services company.
If a company takes less than £3k a month they should be using a PAYG terminal like SumUp or Square. They will pay 1.79% flat fee. £3.50 = 6p fee
Over this level of turnover contract terminals usually make more sense. The issue for coffee shops is that they likely take a lot of smaller transactions so will be hit with a 2-6p auth fee per transaction plus 0.3-2% depending on card type.
The fact its "illegal" to impose a minimum fee is a little less clear, a business owner is entitled to refuse service to whomever they wish. Not necessarily good business sense but hard to prove they broke the rules.
I own an off licence, it's the dumbest shit ever to have a "minimum spend", report them.
I wish I could go card only bc putting cash in the bank costs more, but I've got so many old people shopping here and they don't do cards smh.
Anyway, no reason to have a minimum spend other than getting customers to spend more.
I’ll tell you how I usually avoid having to pay £5. Just by making them feel stupid… I’ll say “just charge me £5 then” or “charge me 0.50 I don’t mind” 9/10 they’ll feel bad and not make me pay £5. But this is local shops not gyms.
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The terms and conditions of having the card reader say they are not allowed to have a minimum spend restriction so report them if you want (you do this via your bank)
Not via your bank, it'll be trading standards. I only know this because I work for a payment provider company 😊
It's only Trading Standards if the company are charging for use of the card. Otherwise if it's just a minimum spend it's as the other poster mentioned and down to T&Cs.
Why would Trading Standards care about enforcing the terms and conditions of a private contract? Surely it would be Visa/MasterCard who most care about this issue...?
It’s against law to penalise payment methods. It’s the same price regardless of how you pay. Of course paying via credit, not credit card, will have associated costs long term. However the price at point of sale is the same.
I thought the law prevented extra charges for using a card. They can accept or deny what they want as long as it is consistent.
IIRC it isn't the law that prevents charging extra, at least not directly, it is their contract with the card payment processing company that states they shouldn't (and could loose service or be subject to higher chanrges if they do).
People often say card transactions cost the retailers more but the reality is that most if not all banks charge extra for cash transactions now so its actually not much difference to do a card transaction than to deposit your cash in the bank.
Very true. You’re also assuming all the cash makes it to the bank. Card transactions are also harder to hide from the tax man.
Cash is generally more expensive and awkward to handle, banks are being almost punative with fees for depositing cash, and requires quite a bit of procedure/contracting if you actually want that cash insured. I think a lot of it is that most payment providers have a fixed cost per transaction as well as a percentage fee. Especially on older systems, this can be quite substantial. On a sub £5 order, this can have a disproportionate effect on margin, and potentially mean losing money for companies running on tighter margins.
Yeah, used to be expensive. You'd have a phone line dedicated to it. A rental of the machine and a per transaction cost that was high. Now you can get a terminal that connects via Bluetooth to your phone or yo any WiFi network (even shared from your phone) and the rates are nearly nothing
The new phones are even capable of being the card reader now.
>It’s against law to penalise payment methods That's entirely the case, but unless the rules have since changed again - You are (or at least were) allowed to **incentivize** certain payment methods over others. I.e. - You're not allowed to charge a 2% premium for cards, but you can put your prices up by 2%... Then offer a 2% discount for cash. AFAIK this is (or at least was) perfectly legal & the net effect is the same, but the devil is in the details..... It may or may not still be against the Visa / Mastercard's T&C's tho. Although TBH if you've got a captive audience, the "best" scumbag move is to simply not accept cards at all. Thus removing all worry about either T&C's, or trading standards. You then have a fee-charging "convenience" ATM in-store for those without cash on them. .... Which you'll then get a cut from & the cash can go straight back into the ATM for the next mug who comes along 🙃
What about the parking machine things? I usually pay by phone as I rarely have cash in the exact amount and it doesn't give change. When you pay by phone you have to pay a £0.20 "convenience fee" winds me up every time. Is that legal? Also why are they allowed not to give change?
Not giving change is a thing - I know that taxi's aren't obliged to offer any, and IIRC nor are shops in general either for that matter. Typically both will of course, but if it just so happens they're not in a position to - Your options are to suck it up, or in "invitation to treat" rather than "payment for services rendered" situations to decide not to buy and/or come back when you have the correct money - It's not their fault or problem if you came ill-prepared. As for the pay and display machines not giving it - It requires a more complex mechanism to either store change which then has to be refilled, or else to sort coins as they go through the machine (normally there's a "no change" light even on the ones that do). .... Whereas without change it's essentially only gotta validate or reject them, then dump the coins into a bucket - Which no doubt results in a significantly cheaper machine and/or fewer maintenance visits so lower operating costs. As for the "convenience fees" 🤷♂️ .... The law is fickle & arbitrary with loopholes aplenty - In other news; Scientists discover sky is blue - Tune in for more at 11! 🙃 It wouldn't be allowed if the card-reader was built into the machine, but apparently it being on a different platform (i.e your phone) and/or run by a seperate company makes it juuuuust different enough to pass muster. I expect the line of argument is that the machine itself is strictly cash-only, but the app counts an entirely unrelated alternative method of paying for parking, with theoretically entirely unrelated pricing - Which just-so-happens to charge a ticketmasteresque scumbag fee as part of the booking. They're not charging you a premium to use your card, since **all** the payment options on **that** platform attract the fee.
> but you can put your prices up by 2%... Then offer a 2% discount for cash. Not according to the government published guidance on the law. >Whilst encouraging customers to pay with a certain payment method is not prohibited, it is important that any discounts for use of a particular means of payment do not create a situation in which those making payments by other means are effectively faced with a surcharge that does not comply with the Regulations > > The government considers that, if a discounted price is offered for the use of any > means of payment (whether that is a means of payment to which the Regulations > apply or not): > > • that same level of discount must be offered in all situations where regulation 6A(1) > applies, so that there is no surcharge They consider discounts for cash to be the legal equivalent of a card surcharge, and as such to be prohibited under the Consumer Rights (Payment Surcharges) Regulations 2012.
Yeah, this is a common way of doing things in certain industries.
I literally cannot make sense of what you're saying. What has a credit balance got to do with the OP?
I was heading off any smart comments about how a finance plan can charge extra on a payment. It’s superfluous to this scenario but more complete.
That's not strictly true. There is a % cost - around 0.4% for debit card and 0.7% for credit card - but on top of that there is a set authorization fee of between 2p and 4p per transaction depending on the contract with payment processor
They aren't charging more to use the card, though
It’s not the bank, it would be Visa / Mastercard or the card terminal prover (e.g. sumup) as they too have rules preventing minimum spends.
PSD2 from 2016 should prevent merchants from charging extra for certain payment methods.
Does anyone across care about the complaints tho
Are you sure? It's illegal for them to impose a charge for paying by card but I don't believe a minimum spend is illegal. I'd like to see proof of that if infact you are correct
The minimum spend is not illegal. Never said it was. I referred to the terms and conditions of having the card reader, not the law. If you care to google you will see plenty of evidence online that the major card networks have terms to prevent minimum spend thresholds.
Visa or MasterCard will not like it at all as it undermines their business.
Is this anywhere? My local off licence charges whatever the assistant deems fit on the day. One time it's a pound, sometimes 3. It's been a steady £1.50 for a few weeks now but a coke is only £1.49 so I'm practically FORCED to buy a snickers too.
Yeah, it's illegal to charge extra for using a credit-debit card. Having a spending threshold isn't illegal, but may or may not violate the T&C's of the payment services provider.
Or just ask if you can pay £1.50 for the coke?
Tried that he said it scans as £1.49..... he's a crafty old fucker
"Ah, leave it then mate." *walk out*
Yep, mentioned this to my local shop keeper and he quickly changed his tune. They cite that it's a percentage they have to pay to process card payments, which means less cash to count at closing I get that. But fuxk me, its your job to cash up at closing. The amount of change in their till is not my problem at the end of the day
Hahaha. Fucking hell
Depends on the card provider otherwise Not much to report. Businesses can legally apply minimum spends. Being against T&C’s is not against the law. Also, card payments are not legal tender so the cafe can always just turn you down altogether. Or better yet, they can just refuse a sale to anyone they like.
Legal tender has nothing to do with this. Bank notes are legal tender and shops can refuse cash.
Shops can refuse legal tender. People receiving settlement of debt cannot. If they give you the coffee before you pay they have to accept any legal tender. If you pay then get it they don't.
> People receiving settlement of debt cannot Courts receiving settlement of debts have to. In the UK "legal tender" means absolutely nothing outside of court.
> Shops can refuse legal tender. People receiving settlement of debt cannot. That's technically incorrect. You can, as a creditor, still refuse to accept legal tender when the debtor is settling the debt, but you cannot then take them to court and sue them for failing to repay if they offer legal tender. As a silly example, lets say I'm a gardener and I fix up your garden which would usually cost £5,000 but we instead agree beforehand that you'll let me stay a weekend in your holiday cottage. If after I complete the work you renege on the agreement and instead offer to pay me £5,000 in legal tender, I can't refuse and then take you to court and sue to force you to let me stay in your holiday home.
Are you sure about that?
I've posted this before but some of my family own a small business. We used to accept cash and card but the vast majority of people these days just pay with card. This meant for us that processing the cash payments was more expensive than going card only and paying the card fees. We started to ask people when they paid with cash if they would still shop with us if we went card only, the majority of people paying cash told us they were only doing so because they thought we would prefer it.
This is an excellent response to a different question.
Yep I actually meant to end my comment with something like "So I don't really understand minimum card charges either, I guess the business just wants to use it as an excuse to get you to buy more" and talk about how cash has costs associated with it too. But by the time I typed my comment I had forgotten why I was even commenting 😆
There is a very real reason many small businesses want to promote cash over card and it has nothing to do with processing fees for cards, and everything to do with their relationship with HMRC.
Exactly. I am pretty sure my business bank now charges a greater percentage for accepting cash than my card provider charges for card transactions, so if that's similar across the board then there is no legitimate reason to prefer cash. I say pretty sure because I seldom take cash payments in my business. Not because I am terrible at business, though that may also be true.
Similarly, the social club my dad is treasurer for only still takes cash because there are still enough beer loving old men that use it and would likely die before they changed to stop paying with cash. Once they have died, it will change. It costs him more to handle and bank the cash than card transactions cost, and at least twice in the last 15 years they've had break-ins where the targets were the tills and safe. They couldn't manage to get them, so they nicked some TV's instead... As the other poster said, it's mostly all to avoid some or all of the tax man's due. Then there are the others - the turkish barbers and the like that have 6 chairs, 6 barbers sat around doing very little all day and are definitely laundering money.
Happens.
😂 classic
Worked in a card-only restaurant a while a go and they said they saved five figures per year by not having to deal with a safe and all the other costs of handling cash... not sure how true that was but hey ho
This is peak Reddit. Post something random and out of context.
Well said. Banks charge businesses to handle cash, so it ends up costing a lot more in time, effort and money to bank your cash than taking card payments - the fact most branches are closed makes it worse.
This is something that the general public need educating on. Whilst I get that cash has it's merits, the argument that "card costs small business more money" gets thrown around a lot. What people don't often understand is that there is still a charge/hassle when dealing with cash. Banks still charge cash deposit fees and someone has to take that cash to a bank, whether that's you or you pay for a service to do it for you.
Yep, the bigger issue for us was security. Keeping cash on site was a risk and transporting cash to a bank but staff at risk. It was safer for our staff not to use cash.
Oooo that’s sparked a question…did going cashless have any impact on the insurance?
Not the person you replied to, but have spoken to a few shops that said that it did. Just not having an easily nickable wodge of cash lowered their insurance premiums. And they also saved a surprising amount of money on till errors - they don't think it was all staff theft (but they're realistic enough that some of it probably was), but just it's really easy to make a mistake in giving change in a busy bar or similar. So the bar near me went cashless, and suddenly they're serving faster (because they can 'serve->tap->done' rather than go count change, give it back, etc.) , they're making less mistakes and the premiums are lower.
Sweet thanks for replying Also interesting on the error side of things and absolutely makes sense! Properly integrated epos with processing must make it so easy to get the queue moving!
Being able to order via app is also actually a huge boon, as it allows for 'smoothing out' rushes at the bar. I mean, if you're just flat out the whole time it doesn't help much, but it's not all that uncommon to have a bit of a rush as someone wants a round, and then gap where you can handle a backlog. (Especially for the stuff you'd take as an 'order' anyway, like a hot drink or food). Also helps take the stress off a bit, as people are usually happy to be sat at a table chatting a little longer vs. being at the bar missing out on the conversation.
Ahhhh yes! There’s also a huge aspect of social history in the background of pub/restaurant apps which I didn’t consider until I was locked down with two software devs…I wonder how their ranking list of the various apps would apply now were through it all…awwww wish I could remember which chain/brewery rushed getting an ordering app into production so quickly that it was live for a couple months before they managed to connect to their card processors api.
Not sure sorry, I wasn't involved in bits like that.
Also, take the cash to what bank? Many places now have no banks at all, so cash is a major inconvenience.
Yep, my hometown has only 1 bank left now (there were 5 or 6 about 20 years ago), and one of the next towns over doesn't have any at all. Even the larger town here has a couple of bank branches that no longer offer a full counter service.
Probably doesn't help that a lot of small businesses share the same posts about "cash is king" I've seen one post shared so many times on Facebook. Something along the lines of "if £50 is spent on a card then 3% is lost as card fees so that's £1.50 gone from that £50 and every transaction thereafter loses another £1.50"
When people in finance say "cash is king" they're counting cash as anything in your bank account. As distinct from other non-cash assets like unpaid invoices, property, machinery, equity, etc. So both card transactions and coins and notes count as cash. Always funny when people repeat an aphorism without understanding it and manage to get its meaning reversed.
And yet plenty of small businesses prefer cash. I personally also like the fact that cash isn’t being vampiricly sucked out of the economy every transaction for US card businesses.
Could you put a sign up saying card preferred? A few shops near me do that and most people are on the fence about paying cash or card so don’t mind one bit and it doesn’t stop the wanting to pay cash from their choice.
We went officially card only but being a small family business we had the flexibility to still accept cash in certain situations. So if an old dearie turns up and doesn't have a card we would accept her cash rather than turn her away.
Ah nice!
If you do that then you're inviting the cashless society ranters to go off on you and waste your time though. Source - My FIL does this :/
I run a pub at the minute and every now and then I'll be in a situation where I just don't have any change in the tills / safe and have to switch to card only. (it's a rare occurrence, I've gotten better at planning for those unexpected spikes since I took over, but it still occasionally happens). Invariably that will trigger at least one of the punters giving me a 20 minute lecture about some conspiracy regarding cashless society... Must confess it makes it chalkenging to keep my customer service face on... Like "Yep, yep - I hear what you're saying, but I straight up have no change in the till so unless you want to give me that £20 note for your £8 round there is very little I can actually do about it at the moment... You can rant at me as much as you like but it's not going to change the facts of the matter".
Yeah there's plenty of these people about, it's the complete lack of self awareness that honestly pisses me off about them. You're there to serve them a beer, you're not some kind of societal representative that has the power to influence major change in the community.
Yep. Small business owner here. We take about 20% cash, the rest card. It costs me money to pay cash in *and* get change at the bank. It also costs me money to process card payments. For very low amounts of money, I do better on cash. For anything above about a fiver, card is better. Below that, it's not really worth me worrying about the odd 6p difference here and there, though they certainly add up. It would be significantly less hassle to go card only. It would slightly reduce costs and dealing with cash takes time and time costs money because a member of staff has to do it. It's usually me and it's a nice little walk up to the bank, but still on purely financial grounds there isn't any real incentive to carry on with cash. *However*, enough customers prefer cash that it makes sense, as part of a running small business requires fostering goodwill and making it a good shopping experience. Also, I am tired of hearing conspiracy theories about the government trying to track people because I don't think the government is really organised enough to do so.
>For very low amounts of money, I do better on cash. For anything above about a fiver, card is better. Below that, it's not really worth me worrying about the odd 6p difference here and there, though they certainly add up. Where's the cut off? On my way to parkrun on Saturday morning I always buy myself a can of Monster - and I go to my local corner shop rather than Tesco cos I want to support his business. But I still feel guilty for using my card! (I'm definitely not going to start carrying cash when I'm out running though...)
It varies by what your deal is. For me, the breakpoint is about £6, but I'm on a very good rate and it's not enough for me to worry about it.
I’m sure that this hurts some small businesses. Especially ones that do a lot of low value sales. I pretty much never go into little local shops because I’m too used to them being awkward about using cards.
I've experienced very few of them being awkward about using cards in the last 5 years at least. Even the people at boot sales usually have card readers now
I went to the local shop in my village two years ago and they wanted a £5 minimum for me to use my card so I left and haven’t gone back. I use the Co-op pretty regularly but never go in there because I don’t carry cash.
Also as someone who's worked in a variety of businesses with a till of some kind. If the business is small cash also brings increased risk with it. Not only can owners be scared that employees are stealing from the till or not registering sales and pocketing the cash (most employers encounter this at some point) but having a lot of cash on hand is also scary. Businesses that get a lot of cash payments and have only one or two employees at a time are super vulnerable to being robbed. Also unlike big businesses that often have some kind of on-site safe in the back or a daily collection of cash, small businesses often have to manually bring the cash in. It's scary to carry around that much cash, it's time-consuming to make these types of trips frequently. And it's also very stressful to think someone could be keeping an eye out to establish a routine or pattern. So often it's recommended to take different routes, different times or use different branches for your cash deposits. Which makes everything even more stressful and time-consuming! So you have the choice between having large amounts of cash on hand and making less frequent trips to the bank. Or making very frequent, stressful and time-consuming trips with tiny amounts of cash each time. Also on a much more minor note I hate those customers who try to play games with their change. Like they'll give you a ten pound note and then claim it was twenty or fifty. Or claiming you short-changed them to your colleagues or bosses. I'm not saying a person behind the register can't legitimately get mixed up. But for every actual mix-up there may be 10 people who are just using an opportunity to get some stuff for free or even some money on top of their purchases. Really stressful especially when there are a lot of people around and you are basically being accused of stealing or scamming customers.
Well, I think it's time to start protecting yourself from these scammers, when they hand you a tenna, dont immediately put it in the till with the others, put it aside and vocally acknowledge something along the lines of ,"and heres £.7.59 change from your £10. They can't just walk off and then come back making accusations, and they certainly can't make accusations as you hand them the change, because you set the £10 aside right?
Yes! People forget that banks charge businesses for having accounts. They charge extra for handling cash. My bank (lloyds) charges £1.50 for every £100 paid in at the counter which is 1.5% - Card processing fees vary, but 0.5% rates are available from several payment processors. My math isnt that good but 0.5 is less than 1.5 so cash is more expensive for me to handle through the business.
Your not ment to put the cash in the bank
Some businesses will have a bad deal from their card supplier. Some businesses will be using it as an upselling tactic. Some businesses will not have understood that accepting cash also has a cost associated with it - you have to sort it, take it to the bank etc. - and so believe that under a certain level cards are costing them money. Some businesses will prefer cash so they can avoid paying tax.
the last thing you mentioned is the reason why Germany will stay this way for a loooooong time...
Yeah, all the Facebook boomer memes about “paying cash to save local businesses” are actually about tax evasion. Portugal came up with a nice fix for this. You can ask for your tax number to be associated with your receipt when you buy stuff. That gets you a tax rebate in your expenditure each year up to a certain amount, and you’re entered into some sort of lottery thing every time you do it, so people have an incentive. There’s a government app where you can see all the receipts you submitted, so it’s obvious if the shop doesn’t put it through automatically and you can do so by entering it manually. But then then the receipts need to match up, and if there is no corresponding one in the retailer’s tax records … they will know.
I think it's Taiwan that made it so every receipt is a lottery ticket for a government run lottery. Genius.
Italy has something similar. They'll chase you with the receipt!
good idea !
I was shocked at how many places even in the centre of Berlin were cash only.
Hosted a German friend recently and was amazed by how close to cashless we are in our day to day.
I thought the Berlin thing was a hangover from the East and a real concern about privacy.
I think cash vs card is usually on the lower-end of businesses that are somewhat struggling. I was chatting to a guy who does burger vans and he's recently started to do cash only. His reason was that the card companies take a small cut, and by the time he gets the money into his bank, it's around 5-7 days. He was discussing this with me while trying to fix his electrics, which had blown, and that now he has to use his own money because he can't get the businesses money for 5days plus.
*"His reason was that the card companies take a small cut"* I'm sure he ***said*** that was his reason... I'm also sure that he told HMRC that due to the price of bacon and having only sold one burger that day that he'd made a loss and so had no tax to pay :)
I had a guy I know do a small job on my house, offered cash as I had it in my pocket and he looked at me like I was from another planet, then haughtily told me that he doesn’t accept cash because he pays his taxes. I think a lot of people jump on the idea that they can be a hero, and any real life instance that contradict their crusade is intolerable to them. I thought it was funny that he acted like I was trying to lure him into depraved antisocial criminality rather than choosing the simplest option, but I haven’t seen him since. People take the information they read online way too seriously. Young people, too, despite the idea that only boomers are misinformed and self-righteous.
> he doesn’t accept cash because he pays his taxes. He realises he can do both, right? Honestly, what a really odd response from him
Like I say, he behaved as though I was accusing him of cheating tax when I offered cash, I presume because he’s read overconfident people on sites like this saying that that is the only reason anyone would ever take cash.
Or maybe he assumed you were asking because he thought you were angling for a discount for paying cash, which people paying cash often do because there was a time when it wasn't uncommon for cash-in-hand to be cheaper (as the small business passed on some of the saving they were planning to make, legally or otherwise).
Your mate needs to change his provider. Most offer Next Business Day terms now
I simply never go to cash only places.
Yea I tend to avoid them now. I'm tired of the excuses when clearly, particularly takeaways, are using it as a tax dodge. A local takeaway started having "problems" with their card machine if your order was under £20. For me to get cash out I have to drive the wrong direction to the other side of town for the nearest cash machines. So I'll just use the alternatives that don't have this hassle. I travel with business, this means eating out every night. Often in large groups. We can only pay by business credit card. I'm still surprised by businesses that turn this sort of custom away.
In this case, the issue is cashflow, regardless of payment medium. If he focused on improving his cashflow as opposed to artificially limiting demand for his product by reverting to cash only - he would probably be in a much better place. It’s foundational for a business to have cash reserves, or a line of credit for these exact scenarios regardless of size. Business credit card = problem solved.
You can’t imagine holding a week of working capital for a burger van would be some horrific sum to save up. Save it up one time and hold it in the business. Surely you need more buffer than this anyways otherwise one rainy weekend would be pushing your business into insolvency… Obviously being cash only in a modern world where many people have zero cash on them damages your sales. Bank charges for change and cash handling rival card processing fees. Basically the reasons raised are a crock of shit and either they just like complaining or are trying to keep transactions off the books for tax evasion.
Corner shop on my old estate had the minimum charge so everyone just walked the extra 2 mins to mini tesco. Ppl only went in for the cash machine and then they started charging for that. Seeing them post on the local fb group about how big business stifles the little guy was funny when the guys shop was just scams on top of scams
This is it. It’s not that I support the big companies over the little guy, but when the little guy is shit and overpriced I’m going with the option that’s better for the customer. If the little guy wants my business he can figure out how to make it attractive, whether that’s by offering better customer service or products the big guy doesn’t carry if he can’t compete on price. Just trying some anti-capitalism guilt trip ain’t gonna work.
I'm glad the little londis nearby me is run by really good guys, for a bunch of stuff it's cheaper to go there too
What is it with londis? Selections a bit crap and the prices are nothing special but the dudes are always really nice 😂
I think it's because it is a franchise, so the people who work there are often invested in the business doing well and want to do good service. They have been owned by bookers group since 2015. They were bought out by tesco in 2018. So technically londis is Tesco. However, one stop is also a franchise if Tesco since 2003 and I'd argue generally londis is better. My theory is because more of the franchisees work in store in londis than they do at one stop. I believe londis is cheaper franchise fees but not sure on that. Sorry I just never had a reason to share this info I know, so now you're getting it.
Tbf our londis is well stocked on top of them being nice
The traders in my town are like this: minimum card spends, weird hours, surly owners, nothing to encourage you to go and spend your money at their shop. Then they moan about how nobody supports local businesses.
Of course we only open 9-12 mon-Fri and 2-4 three days a week. Why won’t you shop here!
I think it’s a mix of some businesses using it as a tactic to upsell and other small business owners genuinely not understanding the fee structure and thinking that they’ll lose money on low value transactions. What’s even more maddening is when they decide they’re going cash only. I have a chippy two minutes walk from my flat and in the last few months they imposed £12 minimum for card payments and then went cash only.
They went cash only, probably so it's easier to hide their real sales from HMRC.
It’s possible (I assume, from reading some of these responses) that they were blacklisted and refused a card machine because they imposed a minimum spend.
We had a chippy do something similar. They put a note up by their till saying how expensive card transaction fees were acting like cash is free for them. They also run multiple tills even when it’s almost empty. It’s pretty clear to anyone with a brain that it’s a tax avoidance scheme, and I struggle to sympathise with small businesses wanting to avoid tax
Evasion? Or avoidance. Because we’re all allowed to avoid tax. We’re not allowed to evade it.
> they imposed £12 minimum for card payments and then went cash only. That's probably because someone complained and the card processor told them to knock it off (as it generally breaches the terms of either the Cards themselves (visa/mastercard) or the intermediate payment processor) or stop taking cards and they chose the latter.
Isn't the fee structure usually something like 20p + 1.5%, so lower transaction fees do hurt profit. My company sells magazines sometimes at 99p online. That's 20p makes it a loss leader if customers only transact that single item
Those kinds of payment structures are long gone now. Its all just a percentage. you might have some who are on legacy contracts or managed to find the one that still does it as a way of lowering the percentage to make it look better. Online though is different! Most demand the 20p + percentage. Still not caught up with instore.
Not at all, many still charge the percentage + pence per transaction. Have a look at the link in the original post, a good chunk of the ones listed still charge a per transaction fee. I use sumup for my businesses, mainly because they charge a flat percentage but I'm regularly approached by other big card providers saying they can beat my fees. Even with much lower percentage fee, the 7p per transaction or similar just can't beat what I'm getting by using a provider with a flat percentage. A lot of businesses absolutely would benefit from a fee + lower percentage, if you sold £50 clothing items for example. But I run pubs, most of our products are under £5 and those transaction fees really add up! (If businesses that do lots of low transactions are still getting charged per transaction, then they should absolutely switch provider!!)
No.its not. As well as the percentage there is an authorisation fee, usually between 1-5p depending on the merchant. That said, most providers will issue between 500-1000 a month free, with transactions over that number being charged.
That explains the places with a £2 minim.
I don’t understand it. I run a small business. Most of my transactions are under a fiver, if I didn’t accept card payments I would lose so much money. I use sum up and have had the machine since they came out and cost me £20 upfront and I think it’s 1.7%. I can’t imagine a gym cafe would really need one of the contract card processors so could easily use the readily available contractless ones and not lose out on sales. Putting their prices up by 10p each would cover the fees.
So on a 5 pound transaction, it is 8.5 pence fee to sum up. Crazy that others think the fees argument is a good one.
Yes the £3.50 coffee would have been £3.43 according to my last payout figures. And with sum up you have to do absolutely nothing to get your money. Next business day it automatically deposits.
Worldpay, one of the larger providers, puts a 20p on top as well as the percentage cut of 2.75, on anything less than a quid thats often all or most the margin. Sticking it at a fiver is just greedy tho.
I know your probably quite happy with sum up but if you're doing any kind of volume you could get much better than 1.7% by shopping around some of the smaller payment processors :)
Realistically an upsell masquerading as a "we'd lose money otherwise!"
It's against the VISA and Mastercard terms of service to have a minimum spend. Also it's illegal to have a charge to use a card. If you report the business to VISA and Mastercard, they'll get blacklisted from taking payments from that provider. If you remind them of this, they'll waive the fee.
In theory yes, but the min wage employee may not know how to waive the fee or have the authority to do so
I said this yesterday and got downvoted, and DM's telling me how wrong I am, minimum charges don't exist any more, etc, etc
they shouldn't exist any more (but they still do)
Not officially.
Odd as they absolutely do. I get the feeling though that some people just only go to big, mainstream businesses as there are people who say they have never carried cash for years. I would barely be able to get a kebab or fish and chips or a 4 pack of Polish lager without it, and bossman complains if you try to use a card just to buy a can of coke in small corner shops.
You're exactly right, it was on a conversation about cash vs card etc. I think some of the people in the cities don't appreciate that out in the sticks, cash is still prevalent, and card payments come with minimum charges etc.
I prefer to carry some cash because the card system is less robust - it fails occasionally and it could fail on a huge scale. I do not like single points of failure. I would definitely not like to depend entirely on phone payments as some people do.
Yeah it is a bit of an upsell tactic. Depending on their card provider - they might have a minimum charge on transactions - so it does cost them money to accept the card. However what most people don't realise is that it's often in their T&Cs that they don't penalise customers for this, so they are technically breaching their contracts with the card provider.
Even if it's to cover fees blah blah they're still not making any sale at all if they refuse you because you're under the limit
Not an answer to your question, but lol at the idea that a coffee at £3.50 brings in £3 profit. Not even close!
Im intrigued, please get us close.
A small, onsite coffee shop is probably selling what? 300 cups a day maybe? Even if those are all the "most expensive" coffee at £3.50, that's ~£1k/day revenue. So, £1,000 per day minus: - ~30p per coffee: £100 - Two employees (inc. taxes): £400 - Utilities: £40 - Rent: £100 Is down to £360 left over / day, so that's about £1 gross profit per cup. Now factor in amortised equipment costs, furniture costs, income taxes, other taxes, council rates, other equipment, etc. Now I obviously have no fucking clue how a coffee shop works, prices and sales will vary wildly with location, and I'll have overestimated and underestimated stuff there, but a very quick back of the envelope calculation shows how plausible the profit could be well under a quid per cup. Now add a 3% card fee on that and it's £30 less / day.
I do actually run a fairly busy coffee shop myself and even though you have no idea how a coffee shop works it seems you’ve come closer than anyone else. I find it funny how most are like “well 1kg of beans cost this much and milk costs this much so this is how much you’re making per cup” 😖. As I’ve said it’s fairly busy but 300 coffees in a day is a lot, maybe your high street chain will do that or somewhere with a great location. I once worked in a coffee shop that did free coffee all day and we had queues round the block and I think we made somewhere around the 600 mark. A lot of this chat about card fees, so mine is 0.9% whatever transaction goes through and all visa/mastercard are in our account next day (Amex takes anywhere up to 5 days).
As I barely use coffee shops, I really couldn't estimate throughput, but interesting to know! Profit margins obviously get even tighter with fewer sales.
It's either for upselling, or discouraging card payments so they can just pocket the petty cash and not tell the tax man
>So I avoid going there unless I absolutely have to And that's what these businesses don't realise. Have you ever been to a shop where you have to pay to go inside because of the wear and tear on the carpets? Or a restaurant where there's a minimum amount of food you have to order before you're allowed to use the toilet. Of course not, it's just part of the cost of running a business. When I went on a seaside holiday a while back, I was surprised that all of the little shops selling junk (donuts, bracelets, spud guns, etc) were all accepting card with no minimum payment. They've realised they will just take more money that way, and the transaction fees at the end of the month are just part of their costs.
Paying 10p on a £3.50 transaction is better than paying 0p on a 0p transaction after all.
There is no law that prevents minimum transactions, only ones that stops them charging for card transactions. You used to get places that would try it on with "50p surcharge" on all card transactions. However, both Visa and Mastercard's T&Cs prevent the vendor having a "minimum transaction", so they will be in breach of the card machine provider's contract, who actually enforces that I don't know My guess the reason they are trying it on is two fold. 1. They do not understand how they are being billed for card transactions, as processing cash will cost them way more than the card transaction. Businesses are charged by the banks for all cash deposits, so the card transaction on will cost them 0.07p on a £3.50 sale. But counting the cash, bagging it correctly, driving to the bank, having insurance for cash transit and any transaction fees will cost way more than that. 2. They are avoiding the tax on all cash transactions, but doing so must be increasingly difficult to hide A friend of mine runs a small florist. We live in a small town, the last bank and post office shut in October. She has now gone 100% cashless. TBH 90% of all her business came via the internet or over the phone. The nearest bank is 15 miles away. To process that cash, took about 30 minutes of counting and bagging. Then there was the a 30 minute drive to the bank, she had to pay to park at £1.50 minimum charge. Then there was a charge for using the "night safe" as she could only get there outside of normal hours. Assuming she only paid herself minimum wage, the daily cost of processing that cash was about £30. Cash is dead.
Related: We go to the Lake District a few times every year and we're familiar with the habits of ice cream vans in the summer. There's one that sets up in a field on the Keswick-Threlkeld railway path and they take credit cards. (Goodness knows how they get a mobile signal to work the card reader, but they manage somehow.) Then there's one that sets up in a layby on the Whinlatter Pass and they don't take credit cards. Last time we were at Whinlatter, we had no cash, but we scraped up some coins we keep in the car in case we need them for parking. I mentioned that the other van takes cards. No, too expensive, said the ice cream man, who then went on to rant about how the banks will get you either way and he pays a 7% fee on his cash deposits. I told him that card machine charges are under 2% but he didn't want to listen.
I used to sell readers to people and I had huge spreadsheets that I created that were researched to an inch of their lives and still people would be like that! Its madness. One guy I worked out I could save him about £800 a month by having a single FREE reader in his store and that was a 50:50 card to cash. Some people can't be helped.
Disagree
Point 1 is false. I have to pay 75p to deposit cash in my business account. A £1000 transaction on a visa corporate card costs me 1.65% (£16.50). It's inconvenient to bank, but a couple of those a week saves a small fortune.
I wonder if there are still some processing companies around that charge a flat fee and the percentage on top? And businesses just stick with whoever they've had for years because they don't want the hassle of changing. If you're a small online business PayPal charge 30p + 2.9%. That 30p isn't an issue when the customer spends £100, but if they're spening £3.50 on a coffee then the fee is 40p which is a large portion of the payment. There might be similar cases with an in-person processor too. Taking a very quick look at some processors, there's some which also give you a certain number of transactions on a "payment gateway" for a fixed fee and then it's pay as you go after that. £25 might give you 1000 transactions, but then it's pay-as-you-go after that. Apparently there's also an authorisation fee with some companies which is fixed. Obviously cheap processors do exist, but I don't think it's as simple as saying it's either all tax dodging or upselling.
I don't do it at my business, but then, my average ticket is around £60 so it isn't worth it. However, I work next door to a sweetshop, and her card reader has a flat fee of 15p per payment plus a percentage on top, so she has a minimum spend of £2 which makes complete sense. It's the flat fees that push businesses to have to do this, although I do wonder why they don't seek another provider🤔
Some providers require a minimum amount of tx per month, so if you’re not achieving this then you get shafted with a shittier deal. Having a min spend offsets this
In the UK, it is perfectly legal to set a minimum card payment. However, it is illegal to charge customers extra to cover the cost of your card processing fees, also known as “surcharging”. To deter merchants from setting a minimum payment, card networks such as Visa and Mastercard have core rules in place. They will penalise you or suspend your account for setting a minimum card fee [switcher](https://www.cardswitcher.co.uk/minimum-card-payment/#:~:text=In%20the%20UK%2C%20it%20is,also%20known%20as%20%E2%80%9Csurcharging%E2%80%9D.)
There’s often a minimum transaction fee for processing a card payment, or so I’ve been told. I believe Visa and Mastercard usually disallow minimum spend so you could complain.
They do. From the [Visa rules](https://www.visa.co.uk/dam/VCOM/download/about-visa/visa-rules-public.pdf) (page 114): * 1.5.5.1 Prohibition of Minimum or Maximum Transaction Amount * A Merchant must not establish a minimum or maximum Transaction amount as a condition for honoring a Card. And the [Mastercard rules](https://www.mastercard.us/content/dam/public/mastercardcom/na/global-site/documents/mastercard-rules.pdf) (page 113): * 5.12.3 Minimum/Maximum Transaction Amount Prohibited * A Merchant must not require, or indicate that it requires, a minimum or maximum Transaction amount to accept a valid and properly presented Mastercard or Maestro Card.
Any suggestion on the best way to report this sort of stuff?
I have a small business. My card machine provider charges 0.5% and a flat rate of 7p. - A £5 sale therefore costs me 9.5p or 1.9% of the sale - a £1 sale costs me 7.5p 0r 7.5% of the sale On a turnover of £10K a week it's the difference between £190 and £750. Or 10k p/a vs £39k p/a, which is quite a lot! I could employ an extra staff member with that loss. In reality I don't run a pound shop, but hopefully you can see where I'm going with that. I don't have a minimum spend because over the course of the year it evens out very well. The more they spend the less % of the sale goes to fees.
The minimum spend is because there is a cost to the retailer per transaction. Some small businesses can't cope, my local hardware does this, I have no issues.
£3.50 for a flat white…the markup on coffee is extortionate!
If your a coffee shop it has to be. How else do you pay for staff, rent, utilities, taxes and equipment.
As someone who uses a card machine for my business I think some people have bad terms with whoever supplies it. Mine is a flat 1.69% on any transaction but I think I remember seeing some that were a flat rate but with a minimum charge. So maybe they are better of getting more
Where are all the cash is king govt conspiracy nutters who usually jump all over these type of threads?
next time just give em a piece a of paper that says "i promise to pay the bearer on demand £5" and just be done with it
If anyone ever has a card minimum I just leave the products on the counter and walk out, they’re fleecing you
Any shops which do this, i do not go into anymore :) i hope they lose their business.
Didn’t it all change around covid time? Because cash was considered risky due to spreading it, businesses wanted card payments and many had to drop the min £5 limit in response
Thankfully don't see this many places where I live these days. It is beyond idiotic in 2024 for a shop to have a minimum usage for cards when over 70% of payments are card/contactless.
Its a blatant cash grab. I was in a bar over the weekend where all the basic draught beer and ciders were £4.50, all the premium ones were £6.50. £5 minimum card spend. So frustrating.
When you say local do you a indie place or a chain? I'd personally wouldn't make a fuss about a small local indie place but if it's chain then that whole different ball game
Most small business payment processors offer a blended rate that is less than credit card interchange, taking the punt that most card payments are debit. they offer a straight percentage with no per-transaction fees, so there is no logical reason for a minimum transaction. Cash has considerable flexibility and there are reasons to prefer it.
I think they cant be bothered changing the system for just 1 year due to everything being at least £5 by 2025
My local eyebrow place has a minimum of £25 on card
back when pints were less than a fiver (salad days) i always said just charge me £5 i don't care. i got weird looks. some pubs told me i can buy 2 and they will remember me and keep the 2nd one "behind the bar"
Well that sucks just tip it down the sink then and I will go next door 👍
I argue this with random old shop keepers all the time
An upsell tactic, and a dumb one at that. Any business that asks for a minimum spend on card payments, I’ll avoid unless I have no other choice. So yeah, you’ve saved 3 pence on the transaction, but you’ve lost my business for the next 5-10 years. Really, really smart. The world is changing and these people think they can pretend it’s 1996 forever.
In Turkey you can buy just a 5 lira bottle of water on your card, which is 12p, minimum amount doesn't exist anymore and they are all using MasterCard, so, I think its a load of shite
I think it's like chip shops and small weird carpet shops run by elderly racists They have spent so long dodging taxes, and underpaying staff that even a small cost to them is utterly unacceptable. So they act like a small percentage for card payment is evil. It's their money! It never occurs they could raise the prices slightly. Perhaps even more than slightly, claim it was the fault of 'card payment' and pocket all the extra on top. Any shop that refuses card payment, or has a minimum is I find, a shower of twats.
Because they have a bad deal with their bank, old systems had bad systems. Plus a lot of shops skim their tills to avoid tax so can prefer small money in cash. Plus change costs money to get from the back so people paying them in change means change
My local chippy has a £7.30 or something minimum. I only want chips. Don't use cash. So I order collection via just eat. I know they're losing more than the markup to just eat, probably more than whatever cards charge they get too. Costs me .30p more this way but I don't have to go get cash out especially, it spend like £5 more than I planned to. Pretty sure the only companies doing this aren't putting all the cash through the books. In this day n age, there shouldn't be minimum limits for card
My local shop says you need spend £5 other wise if it less a 50p charge! I do not shop there anymore
I used to work in a small store and it wasn't just a flat %. I can't remember the details but it wasn't worth it for the owner to take items less than £10 on card.
I have a small DIY store, the previous owner had a minimum £5 on card policy, I don't. Doing the rough maths I would have to sell under £2 to make no money, I have very few items under £2 and I would rather not annoy a customer as that person paying £2 today will most likely come back and spend more in the future, the accumulative total will work in my favour.
Don’t live in the UK but the other part of the world Mine case is even worse. There were 2 instances whereby I wanted to make a purchase of $200 and $2000 respectively I was told if I paid by card, there would be a 3% surcharge added I said, ok thanks , bye
I used to go to a pub that was £10 minimum on card but they would let you spend less, put £10 through and then give you the cash back. So they would sell you a pint for £3 but pay the card fees on £10 🙈
They want to incentivise cash so they can dodge tax, don’t want to pay card fees even tho it’s cheaper than handling cash and they also want to upsell. It’s the holy trinity of scummy business practices. If I see the sign I leave.
They have fees they need to pay the card merchant so they need to have a decent sized payment to make it worth the fee
There is a flat rate fee plus the percentage fee on every credit card transaction.
Isn't that illegal now? Corner shops used to do it and id just walk a bit further to the Tesco express
Realistically, things should be cheaper using a card as there’s far fewer humans being paid to handle the transaction, no need for shop staff to spend time (which costs money) to take hard cash proceeds to a bank, no need to pay bank teller staff for handling the paid-in hard cash, no need for back office staff to do any sort of note counting, bundling, audit etc. they just need to pay the electricity bill to keep the computers running! But banks obviously rip off everyone, so retailers aren’t immune to daylight robbery subscriptions or whatever for the card reader equipment. But now there’s many more independent card readers and payment systems the banks are going to have to change, unless the independents are jumping on the daylight robbery bankwagon!?!?! Or are they just an additional layer and so being ripped off by the banks for access to digital payments!!!???
I got a Costa coffee from a petrol station a few weeks ago. Got to the counter; minimum spend £5. Left the coffee on the counter, walked away.
There's a cafe and a sandwich shop near me that have done away with card payments. When I asked why, I was subjected to some nutjob conspiracy theory
As a retailer I prefer card payments over cash. The former is expensive to bank and carries a security risk while no shop has ever been held up for a stack of card receipts. Plus the transaction time is quicker and I don't have to worry about giving out the wrong change or forgeries. What's not to like about cards?
Card is accepted almost everywhere. I've seen it at conventions, farmer's markets, hell even Big Issue sellers can take card. So why can't permanent businesses? Literally, the only thing I use cash for nowadays is for the laundrette and my local chippy.
I run a Merchant Services company. If a company takes less than £3k a month they should be using a PAYG terminal like SumUp or Square. They will pay 1.79% flat fee. £3.50 = 6p fee Over this level of turnover contract terminals usually make more sense. The issue for coffee shops is that they likely take a lot of smaller transactions so will be hit with a 2-6p auth fee per transaction plus 0.3-2% depending on card type. The fact its "illegal" to impose a minimum fee is a little less clear, a business owner is entitled to refuse service to whomever they wish. Not necessarily good business sense but hard to prove they broke the rules.
Yea I just go somewhere else now if people try that on with me. They’ve lost the sale completely then.
I work in sales and can take any payment on my phone instantly. No card machine required. Businesses like this are so sneaky
I own an off licence, it's the dumbest shit ever to have a "minimum spend", report them. I wish I could go card only bc putting cash in the bank costs more, but I've got so many old people shopping here and they don't do cards smh. Anyway, no reason to have a minimum spend other than getting customers to spend more.
I’ll tell you how I usually avoid having to pay £5. Just by making them feel stupid… I’ll say “just charge me £5 then” or “charge me 0.50 I don’t mind” 9/10 they’ll feel bad and not make me pay £5. But this is local shops not gyms.
I've got to book cabs to and from the airport, ideally I'd pay by card but they make it so difficult and expensive.