No more cash purchases?

Some small businesses are not so sure

Cash is still king, but Visa is trying mightily to dethrone it.

The electronic payments giant unveiled a campaign this month aimed at enticing small restaurant owners to stop accepting cash.

The company is dangling $10,000 each for up to 50 restaurants or food vendors nationwide willing to go cashless. The money is to be used to upgrade merchants’ point-of-sale equipment to accept a variety of electronic payment methods, including chip-enabled credit and debit cards and contact-less technology such as Apple Pay using customers’ cell phones. Owners who don’t need the upgrades or don’t use all the money can spend the extra dough on marketing.

Visa is declaring war on cash, spokesman Andy Gerlt said.

It’s not hard to understand why.

The credit card company makes money on fees collected from merchants every time customers use their plastic. But those fees — which on credit cards average about 2 percent of the transaction amount — are precisely why retailers would prefer that customers use cash.

“Only the smallest and least informed merchants would be likely to fall for this proposal from Visa,” said Mallory Duncan, general counsel for the National Retail Federation, a Washington, D.C.-based trade group. “$10,000 is a small reward for entering into an agreement that could cost a small business hundreds of thousands of dollars over the life of the business” in additional transaction fees, he said.

Mary Lou Scorsone, business manager at Spoonwood Brewing Co. outside Pittsburgh, said she would never consider eliminating cash — even though she estimates only between 5 percent and 10 percent of her clientele pays in bills and coins.

“If you are going to tell customers they can’t use cash, they probably will turn around and walk out the door,” she said.

“I scratch my head at why anyone would be willing to lose customers and pay more service fees to the (credit card) vendor. Why would anyone do that?”

Gerlt said that most customers prefer electronic payments. He also made the case that going cashless eliminates costs associated with handling cash, including bookkeeping.