Paper or Plastic: Why Everyone Should Choose Cash Over Credit Cards

Visa has recently produced commercials touting the use of plastic over the use of cash in retail locations. The premise of the commercial is that everything is running smooth until some Neanderthal hands the cashier cash while holding up the line for everyone else. Who are they kidding? Have you ever been behind someone trying to use their debit card at a POS terminal for a $3.00 transaction? "Enter PIN." "Cash Back?" "Amount OK?" "Hit Enter to Confirm." "Please Wait for Cashier." The message isn't subtle, nor is the 6 billion direct mail invitations credit card companies send out each year for their products. If Visa and MasterCard had their way cash would be virtually eliminated.

Using Cash Hurts
Our family has discovered a simple truth that Visa would never admit to - using cash hurts! If we take the family out to dinner for a birthday celebration and the server brings out the check we have two options. We can whip out a credit card and place it in the tray or fork over that $100 bill that's the only thing lining my wallet. Laying "Uncle Benjamin" down in that little black coffin on the table registers a painful response, while throwing down the plastic causes no pain. We tend to swipe-and-go without stopping to think, hey, I'm going to have to pay for this stuff at the end of the month.

You Spend More with Plastic
Grocery stores and fast food joints figured this one out a long time ago. Sure, they told us they now accept credit cards for "our convenience." Isn't that nice of them? However, their marketing department was working overtime in a backroom at headquarters calculating the potential return on their new technology investment. A report by Dunn and Bradstreet indicates when patrons use a credit card versus cash they spend approximately 18% more for each transaction. Eighteen percent of six or seven dollars comes out to about another dollar per transaction. That's an extra apple pie or two, or a combo meal instead of just the sandwich, etc. Multiply that extra $1 times the "one billion" served and you can see why fast food restaurants were eager to accept plastic.