HUNTSVILLE, Ala. -- Small businesses are encouraging customers to start purchasing items with cash after "Square" announced that expenses for transactions are increasing.
Some are referring to the hiked expenses as the "Squarepocalypse," and are requiring some small businesses, like Piper & Leaf Artisan Tea Co., to scramble to "find another option, change our processes, and / or include additional expenses in the last quarter of the year," according to Piper & Leaf's Facebook post.
Square is a multi-billion dollar credit card processing company, aimed at businesses. On their website, they say: "Our payment, software, and hardware systems can help any type of business."
The Better Business Bureau refers to Square as "a financial services, merchant services aggregator, and mobile payment company." Square is not BBB accredited and they are rated a D- on the BBB website.
Square sent an email on September 26 announcing the new changes. They said the new rate will be 2.6% + 10 cents.
Piper and Leaf Co-Owner Connor Knapp says the new rate will affect his small business a lot. "For Piper and Leaf, our average cost increase per card swipe will be about 52%."
He quoted the website Sprudge saying most small coffee shops will see an average of 66.67% increase.
Now, small businesses are asking for your help. "We're asking people to pay with cash if they're still using the Square system, there's also a petition online," says Knapp. He adds that he knows the petition may not change Square, but it may help them see the impact the change in making on small businesses.
"A lot of people don't realize when they swipe their card, it costs the company money," says Knapp. "So by using cash, you're actually helping the business by saving them a good amount of money."
Several customers said they wouldn't mind using cash when purchasing items within small businesses. "I'm a very loyal customer so I like to frequent small businesses," says Donna Castellano. "If they said it would help them out to use cash, I would absolutely be willing to do so."
Castellano says in the end, using cash helps the small business and the city as a whole. "Huntsville's better, the economy's better if we are encouraging entrepreneurship. Hopefully, the Square will get this worked out but I am more than happy to help a small business."
The rate changes are expected to begin November 1, 2019.
WHNT News 19 reached out to Square for comment and a spokesperson sent us a statement:
"We are changing the US card present rate for Square Point of Sale (meaning any swiped, dipped, or tapped card transactions) from 2.75% to 2.6% + 10 cents. This change will go into effect on November 1 for existing Square sellers. We are making this change to better align our rates with industry-wide-transaction costs. Our card not present pricing has always reflected this structure and now our card present pricing will as well. We are committed to continuing to deliver accessible, easy to use tools that help sellers of all sizes start, run, and grow their business."