Research from the Australian Taxation Office (ATO) has discovered Aussie consumers are turned off by businesses who lack the convenience of new technologies such as Tap-and-Go.
The new research shows that most Australians have negative views of cash-only businesses, with consumers describing them as ‘inconvenient’, and saying it makes them wonder if the business is honest.
ATO assistant commissioner, Mathew Bambrick, suggests the research implies cash-only businesses are missing out on income and the decision could not only be impacting their wallets but their status too.
“The real cost of cash to business seems to be twofold. Consumers are twice as likely to associate ‘cash only’ as negative rather than positive. While the majority of businesses are run by honest Australians who want to do the right thing, being cash-only may have a direct impact on reputation,” Bambrick said.
“Secondly, time is money for business. Tap-and-go payments cost an average of nine cents less than cash payments, and are nearly twice as fast. This research suggests cash-only businesses take a hit to their bottom line by not offering electronic payment.”
The research conducted by Colmar Brunton on behalf of the ATO also discovered two-thirds of respondents believed that cash-only small businesses are likely to be paying less tax than they should, regardless of whether this is true.
The report also revealed that over 40 per cent of cash-only small business owners have never investigated electronic payment systems before.
Bambrick suggested switching to electronic payments delivered benefits to small businesses such as better record keeping and cost savings. He encouraged small business owners to take up the technology.
“While cash is legal tender and we know that some businesses may be used to dealing only in cash, this research suggests that business owners may want to think about the benefits electronic payments can bring and consider what might work best for them,” Bambrick said.
“As well as the benefits to reputation and potential cost savings, electronic payment methods make it easier for businesses to keep good records and get their tax and super obligations right.
“Business owners who don’t declare their income correctly may not be able to identify their true earnings, and may have difficulty obtaining lines of credit. They also won’t get an accurate result against the ATO’s small business benchmarks, which are useful to help businesses compare themselves against their competitors and similar businesses in their industry,” Bambrick concluded.
You can find out more about the survey results at ato.gov.au/electronicpayments