Small businesses accept payments through multiple devices, but are not providing a streamlined experience that supports a migration away from cash.

The complexity of the modern point of sale may explain why paper remains dominant — 70% of small-business owners accept cash and checks, according to a recent survey published by TD Bank. The point of sale market is much more scattered; 20% use traditional point of sale systems, 17% use cloud-based point of sale systems and 24% accept payments online.

The numbers match with other research that finds consumers and merchants are interested in new retail technology but still prefer to have cash as a payment option. Even as some merchants experiment with eliminating cash as an option, a fully digital payments environment is likely far in the future.

Cash drawer
Adobe Stock

Nevertheless, small-business owners prefer to accept all forms of payments to accommodate consumer preferences, said Doug Mearkle, senior vice president and head of U.S. merchant services sales at TD Bank, which surveyed more than 600 small-business owners to gauge how they are adapting to transaction innovation, cloud-hosted technology, the concept of "cashless" payments and openness to new ideas. The owners came from across the country and covered industries such as construction, health care and entertainment.

TD Bank is using the survey as a sales tool, telling merchants how different payment options can be bundled together in a single point of sale device.

“There are tools we can provide to small-business owners through apps based on their point of sale platform system that can provide data they do not have today — such as data around tracking inventory, the shopping and buying habits of shoppers and even weather patterns,” Mearkle said.

For example, a small business on the Jersey Shore can predict daily sales on previous weather patterns. An integrated POS would help the business ensure it's properly staffed and stocked with the proper inventory for a rainy or dry day.

Remote access is also attractive to business owners, with 86% of point of sale users saying the capability is important. Remote access can be particularly important for e-commerce, loyalty programs and the data and analytics to help them drive their business.

The popularity of the technology contrasts with a learning curve. Small-business owners are are aware of the new features, but are still in the early stages of understanding how to use the innovation, Mearkle said. Of the 600 surveyed, less than half (44%) work hand in hand with their merchant sales provider to keep up with the latest trends or other financial products. A little over half (53%) go to their provider only for new technology.

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