Credit cards provide crucial benefits to local businesses, entrepreneurs, and tradespeople. Access to credit cards helps these businesses lower their operating costs and finance major purchases, such as travel, inventory, and accommodations. Rewards programs, such as cash back, give them access to funds they can then use to re-invest in their businesses or give back to their employees. Customers can also take advantage of secure and efficient transactions, including enhanced fraud protections. Credit cards are an essential part of doing business in a modern payment ecosystem and provide key rewards to customers.
Small businesses value credit card rewards programs. From 2021 to 2022, these programs grew by 24%, with top issuers spending $73 billion to maintain and fund these programs. Small businesses, tradespeople, and entrepreneurs use these rewards to earn cash back that they can then re-invest in their businesses, as well as cover business travel expenses, and more.
Local businesses, tradespeople, and entrepreneurs using credit cards for their day-to-day operations can choose the card that works best for them. Thanks to our current competitive credit card ecosystem, small businesses can choose from a wide array of cards that offer travel points, cash back, no annual fees, low interest rates, and robust fraud protection. They have the security of knowing exactly how, when and where their transactions will be processed.
Small businesses earn greater income when their customers use credit cards. When a business first starts accepting card payments, their average transaction size increases by 10 to 15%. Credit card transactions also guarantee payment, and avoid the costs and risks associated with cash (such as errors in counting, storing, transporting, and safeguarding).
Credit cards create opportunities for small businesses. They grant access to e-commerce and mobile commerce channels, which are growing rapidly as more and more customers take advantage of online purchasing. E-commerce sales are predicted to grow over 10% in 2023, and make up 24% of retail purchases by 2026.
