Nearly Half of Small Business Owners Are Most Commonly Paid by Check

New York, NY - Nearly nine in ten (88%) small business owners report that at least some proportion of their customers pay by check, according to a new poll of over 1,000 business owners (defined as having a maximum of 500 employees) conducted by Ipsos Public Affairs on behalf of WePay. Likewise, nearly half (45%) report that their customers most frequently pay by check, while three in ten (30%) say that they tend to be paid by credit card, and a quarter (25%) are most commonly paid in cash.

Among those who are typically paid by credit card, two in five (41%) say that credit card payments are made via their website, just over a third (36%) are paid using a credit card terminal, and 22% are paid by credit card using their mobile device.

• Over half of small businesses owners with only one employee (54%), and nearly half of those with two to ten employees (48%) report being paid by check most frequently, compared to just under a quarter (23%) of those with over ten employees.
• A majority of small businesses owners with over ten employees (54%) say that their customers most frequently pay them by credit card, compared to about three in ten (28%) of those with between two and ten employees, and one in five (19%) of those with a sole employee.
• Small business owners with over 10 employees were also more likely to say that their customers most frequently use a credit card terminal (22% vs. 12% of those with two to ten employees, and 4% of those with a sole employee).
• Likewise, small business owners with a greater number of employees are also more likely to say that their customers most frequently pay by credit card using their mobile device (18% vs. 5% of those with two to ten employees, and 2% of those with a sole employee).

Similarly, nearly half of small business owners surveyed (48%) say that the majority of their customers pay by check, including 17% who say that all of their customers pay this way. However, a majority (52%) report than less than half of their customers pay by check, including 12% who say that none of the customers use this payment method.

However, despite this being the most common payment method, more small business owners report that they are receiving fewer checks today than a few years ago than say that they are receiving more (27% vs. 18%). At the same time, four in ten (39%) say that they are receiving about the same number of checks they were three years ago, while one in seven (15%) say this does not apply to them.

• Small business owners who report receiving more checks nowadays include those with more than ten employees (37%, vs. 13% of those with ten or fewer employees), as well as those in the Northeast (28%, vs. 17% in both the Midwest and the South, and 14% in the West).
• On other hand, about one third (34%) of those with two to ten employees report receiving fewer checks than they did three years ago, compared to one-quarter of those with a sole employee (25%) and those with over 10 employees (24%).
• A greater proportion of small business owners in the West also report receiving fewer checks than they used to (34%, vs. 26% in the South, and 24% in both the Northeast and the Midwest).

Payment by Cash Viewed As Easiest to Accept

While only a quarter of small business owners say that cash is the form of payment most frequently used by their customers, four in ten (40%) view it as being the easiest to accept. Roughly three in ten find checks (32%) or credit cards (28%) -- specifically via their online website (13%), credit cards using a credit card terminal (8%), and credit cards via their mobile device (7%) - to be easiest.

Differences emerge based on company size in terms of which payment methods small business owners find easiest to accept:

• Those with a sole employee (38%), as well as those with two to ten employees (36%), are considerably more likely to find it easiest to accept checks, compared to those with over ten employees (14%).
• In contrast, owners of larger businesses are more than twice as likely to say that they find it easiest to accept credit cards (51%, compared to 24% of those with two to ten employees, and 18% of those with just one employee).

At Cash/Check Only Business, Few Customers Ask to Pay by Credit Card

Among the 80% of respondents who are a cash/check only business, three in five (58%) report that their customers have asked if they also take credit cards, including 26% who say that their customers ask to pay by credit card at least half of the time. Conversely, four in ten (42%) say that they have never dealt with this request.

• Small business owners in the Midwest and the South are more likely to say that they are never asked compared to those in the Northeast (50% and 46% vs. 31%, respectively).
• Those with over ten employees (93%) are much more likely to say that their customers have asked if they take credit cards compared to those with two to ten employees (58%) or just one (37%).

These are some of the findings of an Ipsos poll conducted April 18 - May 3, 2013. For the survey, a national sample of 1,044 small business owners from Ipsos' U.S. online panel was interviewed online. Weighting was then employed to balance demographics and ensure that the sample's composition reflects that of the U.S. adult population according to Census data and to provide results intended to approximate the sample universe. A survey with an unweighted probability sample of 1,044 and a 100% response rate would have an estimated margin of error of +/- 3 percentage points 19 times out of 20 of what the results would have been had the entire adult population of adults in the United States had been polled. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error, and measurement error.

For more information on this news release, please contact:

Rebecca Sizelove Associate Vice President Ipsos Public Affairs New York, NY 212-584-9253 [email protected]

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