Paying to pay your bills. Gonna get worse?

[reddog21]

I have been noticing more and more restaurants and hair cut/ salon businesses switching to cash only and now I guess I know why.

Federal Reserve stats show the exact opposite. Currently, cash accounts for about 14% of all transactions, while credit and debit cards make up roughly 70%, with the remainder coming from ACH or Venmo-type payments. There’s no way this trend will reverse, especially as more and more countries continue moving toward a cashless society.

 

[DCLGirlie]

I have been noticing more and more restaurants and hair cut/ salon businesses switching to cash only and now I guess I know why.

Obviously businesses can do whatever they want, but if I find out a business is cash only I walk out. I only carry a small amount of cash on me for tipping, and I have zero desire to carry enough cash to pay for a haircut or diner for two. People seriously underestimate the cost of time and shrinkage attached to accepting cash as a business.

 

[GAN]

So they want checks?!? Let’s start bouncing checks and see how quickly these businesses go back to zero fee credit card use! First of all, if you “accept” VISA/MC, you accept it -not with some unenforceable disclaimer. That shouldn’t even be legal. Most business people with half a brain would gladly pay 3% to get paid in a couple days -guaranteed.

 

[eticketplease]

So they want checks?!? Let’s start bouncing checks and see how quickly these businesses go back to zero fee credit card use! First of all, if you “accept” VISA/MC, you accept it -not with some unenforceable disclaimer. That shouldn’t even be legal. Most business people with half a brain would gladly pay 3% to get paid in a couple days -guaranteed.

Absolutely agree. There used to be something in the V/MC merchant agreements that the business couldn't pass on the fee to the consumer. @VGCgroupie said this was the case with AMEX as well. I'm not sure if things have changed or because of square, clover, toast and all of these new processors perhaps don't enforce that and then the other processors followed suit or not.

Many businesses have switched to cashless as there 3% fee (whether they pass it on or not) is cheaper than taking cash. Cash takes manual labor to count and balance, along with time to get to a bank to try and deposit the cash. Depending on your amount of cash deposits the banks will charge a fee as well. The account I used to have gave me the ability to deposit a whopping $2,500 in cash a month without a fee after that I was charged 0.3% of the cash deposit. Obviously 0.3% is less than 3% but with all of the hassles of dealing with cash that 3% is not too bad.

 

[DCLGirlie]

Many businesses have switched to cashless as there 3% fee (whether they pass it on or not) is cheaper than taking cash. Cash takes manual labor to count and balance, along with time to get to a bank to try and deposit the cash. Depending on your amount of cash deposits the banks will charge a fee as well. The account I used to have gave me the ability to deposit a whopping $2,500 in cash a month without a fee after that I was charged 0.3% of the cash deposit. Obviously 0.3% is less than 3% but with all of the hassles of dealing with cash that 3% is not too bad.

And a big thing businesses don't account for when being cash only is accidental shrink. Before I left retail I mostly did closing out the cash wrap and depositing money at the end of the day. Even with better than average trained cashiers the till was always short at the end of the day because of things like fresh bills sticking together, misidentifying nickels for quarters, and failing mental math when making change.

 

[seashoreCM]

The Maine Turnpike charges tolls using zones if you pay cash versus (roughly) by the mile if you have an account and transponder (they use EZpass). Specifically the first several exits from the NH border, about 35 miles, cost $4.00 cash paid at the first plaza while a 20 mile trip I often make with transponder within that zone costs about 1.50.

The Boston MBTA (subway, buses) charges more for cash in the fare box (or single use paper fare cards) versus using plastic fare cards although the plastic fare cards can be reloaded using card rates using cash at station kiosks.

At a condominium I own an investment unit one owner offered to count and manage the coin operated laundry income for free but with the condition that it be using a toothless honor system. The condo management agreed to that and the condo received more profit that way compared with one of the laundry machine company methods.

 

[LuvOrlando]

Obviously businesses can do whatever they want, but if I find out a business is cash only I walk out. I only carry a small amount of cash on me for tipping, and I have zero desire to carry enough cash to pay for a haircut or diner for two. People seriously underestimate the cost of time and shrinkage attached to accepting cash as a business.

Really? I always have cash and am unbothered plus these businesses I see all have very steady lines, to each their own I suppose.

 

[DCLGirlie]

Really? I always have cash and am unbothered plus these businesses I see all have very steady lines, to each their own I suppose.

Yep. A ton of bank branches near me closed down, so going to an actually fee free ATM is a major hassle to me, which means carrying cash is a major hassle for me. Plus as an added bonus I like the fact if my wallet is stolen I'd only lose $20-40 in cash and I could just lock all my cards vs if it was stolen with all cash.

 

[barkley]

Yep. A ton of bank branches near me closed down, so going to an actually fee free ATM is a major hassle to me, which means carrying cash is a major hassle for me. Plus as an added bonus I like the fact if my wallet is stolen I'd only lose $20-40 in cash and I could just lock all my cards vs if it was stolen with all cash.

not 'banks' but we've seen the opposite with an explosion of brick and mortar credit unions opening in our region and it's a rare store that doesnt have a bank of atm's associated with different financial institution (big name banks/credit unions) affiliations for no fee usage.

I get the concern with not wanting to carry allot of cash in the event of theft but in my experience with a wallet theft dealing with the debit card aspect of it was far more potentially costly. despite less than 20 minutes before the apprehension of the thief and recovery of the wallet/debit card the theft of the entirety of the associated checking account as well as the associated overdraft savings account had been accomplished (we were told by law enforcement that the saavy theives immediately call a contact w/the card info so that even if they are apprehended immediately the money grab can proceed). in our case it took a good couple of weeks for the financial institution to do it's fraud investigation and refund the stolen monies and thankfully we had other funds to cover pending auto payments/meet immediate needs but if we had'nt

 

[Magical2017]

Haven't seen much of this, only with taxes in Pa when we had a home there and maybe for car excise here in Ma but it was explained in Pa that this was because the municipalities weren't at liberty to use taxpayer funds to pay fees.

I have been noticing more and more restaurants and hair cut/ salon businesses switching to cash only and now I guess I know why.

Maybe it is just as well, we were all getting too reliant on cards and paying interest to use them. It is shocking to think that the 29% or so interest most people pay on cards could jump another 4% or so at the point of sale, that is a huge chunk of income and once people get caught up it is very tough to detach Whole system is out of hand, hopefully this will be a deterrent for new younger consumers to avoid the whole mess, terrible situation.

Agreed about the interest. We use credit cards but don't pay interest because we pay them off each month.

 

[barkley]

Agreed about the interest. We use credit cards but don't pay interest because we pay them off each month.

same here and while I'm not one to chase points/rewards and such largly b/c I don't like to pay a fee for having a credit card I do enjoy the financial benefits of using one of my credit cards that saves me 6% on groceries (dollar value of the rewards which I always save and use as a statement credit a couple of times a year) and recently added all my streaming subscriptions for auto pay b/c they now do a 6% reward on those (and a $10 additional per month statement credit just for having my Disney+ paid through them). it all adds up.

 

[ilovebassets]

I thought it was illegal to add a fee for a debit purchase

This. Debit card should be charged as cash and this fee should be reported to the bank. I'd also send a letter to the office manager with a printout of the regulations.

 

[WDW_fan_in_TX]

Haven't seen much of this, only with taxes in Pa when we had a home there and maybe for car excise here in Ma but it was explained in Pa that this was because the municipalities weren't at liberty to use taxpayer funds to pay fees.

I have been noticing more and more restaurants and hair cut/ salon businesses switching to cash only and now I guess I know why.

Maybe it is just as well, we were all getting too reliant on cards and paying interest to use them. It is shocking to think that the 29% or so interest most people pay on cards could jump another 4% or so at the point of sale, that is a huge chunk of income and once people get caught up it is very tough to detach Whole system is out of hand, hopefully this will be a deterrent for new younger consumers to avoid the whole mess, terrible situation.

I’ve stopped using my credit cards and currently working on paying them off. Both are in the 36% APR range, and one has an annual fee of $100 billed monthly for $8.25/month. So on that one, out of every $30 monthly payment only about $10 goes to actual principal. I now tell people to not get a credit card if at all possible. But I know you have to have them to reserve a hotel, rent a car and other things.

 

[FreeTime]

I’ve stopped using my credit cards and currently working on paying them off. Both are in the 36% APR range, and one has an annual fee of $100 billed monthly for $8.25/month. So on that one, out of every $30 monthly payment only about $10 goes to actual principal. I now tell people to not get a credit card if at all possible. But I know you have to have them to reserve a hotel, rent a car and other things.

You do not have to have them to get a hotel, rent a car, etc. A debit card works just fine. Unless prepaying for a rental car, I always select the pay on site option and cash is accepted.

 

[eticketplease]

I’ve stopped using my credit cards and currently working on paying them off. Both are in the 36% APR range, and one has an annual fee of $100 billed monthly for $8.25/month. So on that one, out of every $30 monthly payment only about $10 goes to actual principal. I now tell people to not get a credit card if at all possible. But I know you have to have them to reserve a hotel, rent a car and other things.

I'm sorry you are in this situation. Credit cards are great if you can manage them but obviously can wreak havoc if you can't. Even if you can manage one bad stretch of luck can affect you. I would never not recommend one form of payment vs another without actually knowing their situation.

If you can only pay $30 monthly for your card are you able to split that? The first $15 payment will help lower the interest and then you can make the next $15 payment by the due date. This should help with more going towards principle.

**Not a financial or legal advisor so please consult with one before taking advice from someone on disboards

 

[DCLGirlie]

You do not have to have them to get a hotel, rent a car, etc. A debit card works just fine. Unless prepaying for a rental car, I always select the pay on site option and cash is accepted.

Don't use debit cards for hotels, or anything else that requires an incidental hold or security deposit. Any hold on a debit card means you can't use that money until the hold is lifted, which can take up to a week after the finalized bill depending on the bank in question.

 

[barkley]

Don't use debit cards for hotels, or anything else that requires an incidental hold or security deposit. Any hold on a debit card means you can't use that money until the hold is lifted, which can take up to a week after the finalized bill depending on the bank in question.

likewise-always take a second credit card with you b/c you don't want what happened to us happening to you..........Disney glitched with their set incidental hold amounts and while they processed the actual expenditures each night something glitched and they didn't release each days incidental holds BUT placed a subsequent hold for each of the following days (which also didn't get released). I don't recall the full amounts of the holds but it ended up with something like-

day 1 $300 hold plus whatever we actually spent
day 2 rollover of previous days $300 hold plus new $300 hold plus what we actually spent...rinse and repeat for 12 days resulting in over $3600 in charge holds that took multiple calls to multiple departments (none of whom seem to operate during the same hours as one another so communication between them and the credit card company was lacking to say the least). I got so sick of hearing 'just wait, they will eventually fall off'-well that's fine if you've brought a second credit card with you to cover the expenses you knew were well within the several thousands less than your Disney actually cost I think it took a good 3 weeks to resolve (thankfully we weren't reliant on that credit card for any of our day to day expenses).

 

[DCLGirlie]

likewise-always take a second credit card with you b/c you don't want what happened to us happening to you..........Disney glitched with their set incidental hold amounts and while they processed the actual expenditures each night something glitched and they didn't release each days incidental holds BUT placed a subsequent hold for each of the following days (which also didn't get released). I don't recall the full amounts of the holds but it ended up with something like-

day 1 $300 hold plus whatever we actually spent
day 2 rollover of previous days $300 hold plus new $300 hold plus what we actually spent...rinse and repeat for 12 days resulting in over $3600 in charge holds that took multiple calls to multiple departments (none of whom seem to operate during the same hours as one another so communication between them and the credit card company was lacking to say the least). I got so sick of hearing 'just wait, they will eventually fall off'-well that's fine if you've brought a second credit card with you to cover the expenses you knew were well within the several thousands less than your Disney actually cost I think it took a good 3 weeks to resolve (thankfully we weren't reliant on that credit card for any of our day to day expenses).

I'm so sorry that happened to you. Hotels can be very flustering, because while I fully understand an incidental hold they so frequently go screwy and leave people in limbo.

Also, while I hope it is different at Disney, I will say the hotel industry as a whole is plagued with high turn over and next to no training. At my first hotel job within 3 shifts of training they had me working evening shifts where I was the only employee in the hotel and thus the defacto manager on duty for 6 hours a day. With a system like that it is no wonder that billing mistakes happen so frequently and take so long to resolve

 

[Kestryl]

I have a running list in my Notes app of places that charge fees on top of their list prices- so credit card fees, required service charges, “insurance for the employees” fees (this started popping up at a few restaurants here). I don’t tend to go back to those places.

I’m fine if a business wants to give a cash discount, but that should be an actual discount. Tell me the price. It’s feels petty if you add to it. It feels great if it ends up being less.