Cash v Cashless: The Showdown

August 10, 2023


If you are a retailer, you might think that cash is the best way to accept payments from your customers. After all, cash is simple, convenient, and widely accepted. Plus, many cannabis retailers keep the ATM fees. However, you might be surprised to learn that cash can actually cost you more than debit cards in the long run.

Cash has many hidden costs that are not obvious at first glance. For example, you need to pay for the security of storing and transporting cash, the time and labor of counting and reconciling cash, the fees of depositing cash at the bank, and the risk of theft and fraud. These costs can add up to a significant amount of money over time.

Cashless payments like POSaBIT Payments, on the other hand, have many benefits that can save you money and hassle. For example, debit cards are faster and easier to process than cash, reducing the waiting time for customers and the workload for staff. Debit cards also reduce the need for cash handling and storage, lowering the security and operational costs. Debit cards also offer more protection against theft and fraud, as transactions are verified and recorded electronically.

According to a study by IHL Group, a retail research firm, cash costs retailers an average of 9.1% of their sales, while debit cards cost only 5%. That means that for every $100 of sales, cash costs retailers $4.10 more than debit cards. Over a year, that can amount to thousands or even millions of dollars in savings.

Research shows that more and more Americans are joining the ‘cashless’ economy. As recently as 2020, 41% of Americans reported that none of their purchases in a typical week used cash – a number that has only grown through the pandemic.

While normal retail transactions - the everyday experience for most consumers - tend to be about 80% cashless, cannabis retail transactions are almost the opposite: around 20% cashless. If consumers have a demonstrated preference for cashless transactions, why are we forcing them to use inconvenient, unusual methods to pay?

So, if you are a retailer who wants to reduce your costs and increase your efficiency, you might want to consider switching from cash to debit cards as your preferred payment method. Not only will you save money, but you will also improve your customer satisfaction and loyalty.

Why are cashless payments superior?

The acceptance of cashless payments, which have become synonymous with convenience and speed, can allow dispensaries to generate more revenue and drive long-term growth.

Why is cashless better than cash? A few reasons:

  • The psychology of limiting funds.
  • Interactions with budtenders.
  • Tips.
  • Normalcy.
  • The cost of handling cash.

What about my ATMs?

A lot of dispensaries own their own ATMs, so they are reluctant to abandon cash payments. However, people who go on debit don’t go off debit: they see that the benefits of cashless payments greatly outweigh the benefits of cash payments. Losing a little bit of ATM profit is well worth the significant growth in overall ticket price. As a more inclusive, accessible, and profitable option, cashless debit payments will likely continue to overtake cash for dispensaries and customers alike.


Death by a thousand costs.

The Cost of Cash

With the use of cash comes additional responsibilities, such as counting down safes and preparing till bags. Cash closing duties can often take managers hours, leaving them alone in a facility with thousands of dollars in the late evening/early morning hours.

Processing Cash

Processing cash through many banks and credit unions costs around $1.50 per $1000.

Transporting Cash

Transporting large amounts of cash typically requires an armored car service, which can cost up to thousands of dollars.

ATM Expenses

Ongoing operating expenses of ATMs include commissions, taxes, servicing, maintenance, and insurance. Additionally, ATMs can typically only be restocked once the shop is completely closed.