Why some merchants prefer credit card transactions

Information verified correct on October 26th, 2016

In this day and age, the credit card has officially become one of the most popular forms of payment with consumers and businesses alike, providing more convenience than any other payment method.

It is unanimous that credit cards allow consumers much more flexibility and ability to increase their purchase power. When it comes to convenience, credit cards are easily portable and they don’t need to carry bills upon bills of cash. Even though there is the possibility of credit card fraud, the credit card is still now the most preferred payment option of almost all merchants.

MasterCard and Visa now have programs in class to prevent fraud from happening, such as Verified by Visa and MasterCard Security. As long as you can prove that you didn’t make the purchase, or the purchase was fraudulent, then you’re likely to get your money back.

This article looks in to why some merchants prefer credit cards as a payment method, in contrast to our previous article on the reasons why merchants do not like to accept credit cards.

Reasons why some merchants prefer credit card payments

Majority rules

The biggest reason merchants love credit cards is that it allows the consumers and businesses to be part of the majority retail purchasing trend. By accepting credit card payments, merchants are inviting the patronage of all consumers rather than losing customers like those merchants who only accept cash.

Even though merchants have to pay fees and percentages to the credit card companies for the ability to accept credit card payments, the benefits and increase in sales makes up for the costs. The fees differ depending on the lender but they are usually not high enough to force merchants to not use their services.

Saves everyone time

We all know how annoying and irritating it is to wait in line at the register while you or someone else digs through their wallets and purses searching for dollar bills and coins to pay the cashier with. In addition to paying cash, writing a cheque is an even bigger waste of time. Why not make life easier and quicker with the credit card? With an easy swipe of the card and your signature on the receipt, the transaction is complete and you are on your way onto the next task in life.

Process more orders

It is because of the credit card that product sales over the telephone and Internet have become possible. Before the credit card, merchants would only be able to secure cash payments by requiring the customers to come directly to the retail location in person. This significantly limits traffic and exposure for the merchant. This plays into one of the most basic principles of business, more transactions equals more revenue which then turns into more profits.

Improved cash flow

Credit cards allow merchants to receive their funds much more quickly than having to wait for cheques to clear the bank. When processing a cheque, merchants have to continue operating without those funds which can prove to be problematic. Credit card payments are almost always processed immediately with the merchant receiving the funds in a very short amount of time.


Tighter security

By using credit cards, merchants are holding themselves up to a higher security level with more safety as well. Businesses become lesser targets to theft and robbery when they carry less cash on hand. On the flip side, merchants and consumers are much more able to keep track and log all the purchases and transactions. These usually come in online monthly statements but now every bank and credit card company allows their consumers to check their transactions online as well. This also results in less fraud attempts.

About credit cards with refund protection

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Credit Cards Comparison

Rates last updated October 26th, 2016
Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
Enjoy a 0% p.a. balance transfer offer for 18 months and also earn 2 bonus Velocity Points in the first 3 months on everyday spend.
20.74% p.a. 0% p.a. for 18 months $64 p.a. annual fee for the first year ($129 p.a. thereafter) Go to site More info
ME Bank frank Credit Card
Enjoy a low and consistent interest rate on purchases and cash advances, combined with no annual fee.
11.99% p.a. $0 p.a. Go to site More info
HSBC Platinum Credit Card
Receive a full annual fee refund and save $149 if you meet the $6,000 spend requirement. Enjoy a balance transfer offer and platinum card benefits such as complimentary insurances and concierge services.
19.99% p.a. 0% p.a. for 15 months $149 p.a. Go to site More info
NAB Low Rate Credit Card
The NAB Low Rate Card offers 0% p.a. on purchases and balance transfers for 15 months. This card also comes with a low annual fee.
0% p.a. for 15 months (reverts to 13.99% p.a.) 0% p.a. for 15 months with a one off 3% balance transfer fee $59 p.a. Go to site More info

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