Visa offers payment to businesses that stop using cash

PITTSBURGH - Cash still is king, but Visa Inc. is trying mightily to dethrone it.

The electronic payments giant unveiled a campaign this month aimed at enticing small restaurant owners to stop accepting cash.

The company is dangling $10,000 each for up to 50 restaurants or food vendors nationwide willing to go cashless. The money is to be used to upgrade merchants' point-of-sale equipment to accept a variety of electronic payment methods, including chip-enabled credit and debit cards and contactless technology such as Apple Pay using customers' cellphones.

Owners who don't need the upgrades or don't use all the money can spend the extra dough on marketing.

Visa is declaring war on cash, spokesman Andy Gerlt said.

The credit card company makes money on fees collected from merchants every time customers use their plastic. But those fees - which on credit cards average about two percent of the transaction amount - are precisely why retailers would prefer that customers use cash.

'Only the smallest and least informed merchants would be likely to fall for this proposal from Visa,” said Mallory Duncan, general counsel for the National Retail Federation, a Washington, D.C.-based trade group. '$10,000 is a small reward for entering into an agreement that could cost a small business hundreds of thousands of dollars over the life of the business” in additional transaction fees, he said.

Gerlt said that most customers prefer electronic payments. He also made the case that going cashless eliminates costs associated with handling cash, including bookkeeping, the time it takes to count the money and the potential for theft.

'We've had a tremendous response in the last 24 hours (including) from other countries and other kinds of businesses saying they would welcome this program,” he said.

Winners of the $10,000 awards will be selected through an application process beginning in August, he said. Details on the size of the businesses that qualify were still being worked out.