2020 is upon us and the trend of payment apps continues to grow, which is cool if you’re splitting a bill with friends after a night out at the bowling alley or even paying your mom for half your cell phone bill. But is it really a good long term solution, or even a legal way of taking payment for your business? The short answer is no, the long answer is a little more complicated and takes some in depth analysis, but hey let’s not bore you with a financial model and lawyer talk of what’s legal and what’s not when getting paid from customers.
According to recent surveys and analysis the following statistics make the case for accepting credit and debit cards quite compelling.
- 70%+ of Americans have a debit card
- As of Nov 1, 2019 there are 374 million open credit card accounts in the US!
- The average American has 2.6 credit/debit cards in their household
- Millenials make up the largest demographic of new credit card applicants
- The average rate on credit/debit cards have come down
Now let’s do a brief “analysis” on the app movement, think venmo, Zell, Cash App, etc. These apps originated to transfer money between friends and family, think sending over money to your buddy after a night out drinking when he drunkenly picks up the full tab. (Don’t you love those 8AM venmo requests with the beer emojis). These apps were created to seamlessly move money between people, not for services or business related activities, simple as that. Slowly but surely these apps began working their way into businesses and industries that went unregulated or unchecked. The tattoo industry became one of the first larger scale industries to attract app payments for the simple reason of mass availability, quick payment, and quite frankly the ability to get paid without much documentation. We get it, you want your money, and you want it quickly. Historically payment apps have had two simple ways of sending money. The first being via your linked bank account and or debit card (often the same account), and the other being a credit card, subject to a 3% fee. Cool, easy enough right? But what happens when you want to get paid instantly? Payment apps, all of which are owned by large, publicly traded companies that focus heavily on profits, have begun to increase their transfer fees gradually, year by year. Meaning, when you transfer that $100 payment after a tattoo session, the app is going to eat anywhere from 1.5%-2% of that transaction, and probably more as we move into the future and companies want to monetize money movement. In addition, if you are to label the reason for the transaction as “tattoo”, the app companies often times monitor and flag your account. In short, transaction costs are rising, the movement of money from customer to your studio is not technically legal, and not feasible long-term solution.
So what is the solution you ask? Debit & Credit! Today, three out of four Americans own some sort of debit or credit card, meaning that most people coming in for a tattoo will more than likely be able to pay with their card (if they have money in their linked venmo bank account, they have money on their debit account). What if I told you, you could open up the floodgates to your studio and start accepting payments on debit cards at as low as .8%? You heard me, point eight percent, spelled out! Half the transfer fee of many apps in the industry, while all doing it legally and recorded properly on the TattooPro software for financial reporting purposes? Does that peak your interest? Had a feeling. Let’s recap and end all this financial talk.
- Three out of every four Americans own a debit or credit card
- Contrary to popular belief, Millennials lead the industry in new debit/credit card applications
- TattooPro allows you to accept payments on debit cards as low as .8%, half the transfer fee of payment apps
- TattooPro has the benefit of having its own payment gateway, saving you a large percentage vs competing software payment solutions
- Legally take payments through a secure payment gateway, and get paid the right way
- Legitimize your studio, take control of your financial future and open it up for larger transactions (hey why not let the guy with the Amex come in and spend $750 on his credit card).
Starting winning and accepting payments with TattooPro!