Forms of payment at coin shows and their future.
morgandollar1878
Posts: 4,006 ✭✭✭✭✭
It has always been the norm for cash to be used at shows when buying coins and on occasion paying by a personal check. About a year after I started my business I started bringing a credit/debit card reader with me to shows to take payment. I thought that it would be nice to have with me just to be able to help give show goers another way to pay. I don't use it very often but it does get used. Now, four years later I see a few more dealers that are accepting credit/debit card payments when I go to shows. Lately I have been considering other forms of payment accepted too.
With the onslaught of e-bay collecting sales tax on coin purchases, I think that this is a great time for more dealers to expand and take other forms of payment other than cash or check at shows. I feel this way for multiple reasons starting with making it easier for the younger crowd to make purchase since many do not like carrying cash with them. Second is that dealers would not have to worry about having so much cash with them at the shows. Many dealers and collectors that frequent shows are worried about the existence of the coin show into the future and just the hobby in general.
Would this help coin shows survive, at least maybe help a little? I think that it would help at least to a certain extent. What do you all think? Let's discuss it.
Comments
It certainly helps offer another alternative for those that don’t have cash on hand.
Quick question: how do you mitigate the risk of a chargeback?
I think accepting electronic payments through Venmo, Zelle, or Cashapp are viable options as well. Funds can be sent and received instantly, with no chance of chargeback like credit card payments.
https://tinyurl.com/wbuh7ba (Search PCGS on ebay)
It would depend on the form of payment. I have taken Pay-Pal F&F before at shows. If it were a credit/debit card I think that it is unavoidable unfortunately. Each dealer would need to have their terms set for these types of purchases.
Is your cash/check price the same as your cc/debit price?
It would depend on what you are buying. If you are buying low margin items like bullion or junk silver then no. Most if not all dealers would add on the CC fee to the purchase price.
I understand the convenience of electronic payments at shows but I would much prefer cash.
I tried to do a sizeable deal with a dealer in state last week; though he does a lot on ebay he doesn't take paypal or ccs in his store even with an extra 3%. A couple days later a smaller and younger dealer did accept my cc with the 3% extra.
I always take cash to the shows, small bills, this helps the dealer as well. I can remember back in the 80's seeing lines of 15+ dealers at Silver Townes table selling Leon their checks at the end of the shows for 97%. I asked about this and was told he owned a bank. Leon and his son were always very friendly.
I always paid cash at shows. Yes, I carried a lot of cash. I did do trades a couple of times, usually with a little added cash though. I prefer to deal in cash in most of my purchases. Cheers, RickO
Customers love the convenience of credit cards but again they are not paying the cost of processing...unfortunately Chargeback rules are fairly liberal and one lost Chargeback could wipe out a dealer's profit for an entire show...
PIN-based debit is an option but most banks have a fairly low daily withdrawal limit ($600 to $1000)...which can sometimes be increased by making a call...
Cash will always be King until something de-thrones it. dealers work on close margins, closer than many here are willing to believe, and anything that cuts into that only makes it harder for them to justify the expense that a large show entails. it may seem like 3% is a small amount until you consider that a dealer does in excess of $100k at these shows. that's a healthy chunk of change to swallow just to make it convenient for the buyer.
put another way, some of the really large dealers would be swallowing fees that exceed the annual salary of some customers if it weren't for checks and cash.
I’ll be taking cash / cards to the coin show this week in Long Beach in hopes I will be able to use both.😎
I used just checks at the recent ANA in Chicago and they worked just fine. Cash was only used in the vending machine and at a convenience store.
Member ANA, SPMC, SCNA, FUN, CONECA
It's inevitable, for convenience as well as safety.
It will take some time. Coins being a (cantankerous) old man's hobby, they will resist for as long as they can.
I would rather take cards than checks unless it is someone I know.
I agree with a lot of that. Margins are ridiculous.
The only enhancement I would offer is that some of the REALLY large dealers routinely take cards. That may be because they get preferred rates from their processor or it may just be that they have enough total volume that they can afford the fixed costs on a smaller margin.
I take cash (of course), checks, and credit cards through Square. If paying with cash, I can usually offer a discount, but if paying with a credit card, there is no discount.
The Penny Lady®
Agreed, cash is always the best.
@keets I agree, margins are small and that small amount can add up fast, but I'm not just talking about credit/debit cards here. I am also referring to other forms of electronic payment like Pay-Pal and Venmo.
The trustworthiness of the buyer is what counts. Beyond that the dealer needs to protect himself/herself from significant losses due to fraud or other circumstances such as unexpected death of the buyer which results in payments being tied up in estate matters.
Cash doesn't bounce.
PayPal and Venmo are credit based unless you abuse the Friend & Family option.
The charge back thing is the problem. The 1st time I was envolved with a credit card transaction I was sharing a table with a friend who accepted credit cards. I had a customer who wanted a complete set of Barber Half's I had but was only able to pay with a credit card. He agreed to pay the CC processing fee and my friend processed the transaction. This of course showed the transaction taking place in the city where his shop was.
The guy does a charge back saying he had never been there. Yeah, took nearly a year to get resolved.
I have allowed a few folks to use my computer to pay with paypal...but most are reluctant. I will say I am loosing a few sales lately because I will not accept credit cards...but still isin't worth the risk to me. Unlike @jmlanzaf I would rather take a check as long as they have proper ID. I have taken 1000's of checks and only had 2 bad checks.... 1 which was from a dealer and the other I assumed(my bad) a good friend of mine new the guy writing the check since he took 1 from him as well.
I would think that a signed receipt would suffice in a charge back investigation. You could also require ID and even take a photo of person and ID if you wish.
People have the preferences/biases. Interestingly, you cite an almost CC problem that was resolved in your favor against 2 actual check problems (resolved or not?).
Thankfully - I'm knocking on every wooden thing including my head - I've had very few problems with either form. But I've done 40,000+ CC transactions through PayPal and only had 1 chargeback that I won. I've accepted several thousand checks (5-10,000), mostly back before PayPal, but I had to write off 6 of them due to bounces. All 6 were small amounts, so small that the bounced check fee was probably more than the check itself.
The only downside to CC transaction is the transaction cost. So, frankly, I could afford to eat a few bounced checks against the total volume of sales. But the calculation shifts the bigger the amount is.
I don't refuse to take checks, but usually someone who wants to write it is short cash relative to a larger purchase. Most small purchases people pay cash (at shows). So, for a big purchase especially at a show where I may not know the customer, I'd prefer to pay the 3%
I agree that there can be issues with chargebacks on credit cards, and bounced checks as well. Knock on wood, I have not yet had that problem yet. I think that a bounced check can be just as bad or worse than a chargeback on a credit card.
Really though, I think a large majority of people are honest enough to not cause any issues no matter what form of payment that they wish to use.
Oh, I think a bounced check is DEFINITELY worse. With a chargeback, the CC company will investigate. With a bounced check, unless the check writer is in your town, good luck being able to do anything about it. The bank won't do anything. All you could do is take them to small claims' court.
Chargebacks have to have enough evidence to back them up, it may be "work" and clearly there are some looking to scam the system.
ALWAYS.🙂
Hardly ever leaves tracks also.
If a dealer and you leave a show with $50K in cash, do you put all or most of it back into your bank account? Do you have any splainin to do or do you just do the 8300 and next deposit in?
Actually, the bank reports cash transactions above $3k and have for years. Many banks including my business bank now charge for cash deposits above $ XX amount per month. I know of a couple of dealers that rarely make cash deposits. They buy for cash & sell for same, and the profit leaves the company as cash.
the era of the 3% digital transaction fee will die, and most of the payments will become digital. The tech/credit card companies themselves will come and go, but it will all become digital soon enough.
It's tricky. If the transaction fee drops too much, it's probably because they eliminated fraud protection, etc.
Until your bank bag is stolen. You can get replacement checks from your customers, but the cash is gone forever.
They may "record" them but I don't think they are reported on form 8300.
My budget for Opex does not permit me take anything but cash at shows. I have always been a cash payer at shows except for the bourse fee deposit for next show (check).
The only uptick this year bullion everything else horizontal at best. I take a beating on PayPal / eBay fees. For many coin biz has been a sch c tax shelter for sometime.
A cc chargeback would be disastrous with the narrow margins....plus I don’t want them makin a dime off me. Cash is king at shows - numismatic investment is about financial privacy not leaving a digital trail. Coin shows not only place cash is king.....Houston is to strip club hobbyists like Angelfire or Vail are to skiing.
If show buyers have the money they know where to find an ATM. Many who have a cash business (bar or restaurant) are cash payers at shows. Don’t take anything but cash on gold coins. Many been burned on bad checks so st least have risk limit lol. Don’t run up cc debt once u spent the cash u brought to show. This market is not worth it.
On cash transactions I would just be cautious with legal issues possibly connected to structuring on large transactions. http://www.quatloos.com/Q-Forum/viewtopic.php?f=51&t=9705&p=267412&hilit=structuring#p267412
I write checks. I have never had one refused. Dealers might have someone vouch for it on the floor, but that has not happened to me for many years.
All of the other stuff, credit and debit cards, will cost the dealers and you money. But the day might come when checks become obsolete.
Once people have met each other (even over the forum), the need for fraud protection usually goes away. Look at the proliferation of paypal F&F as a way for people on the forum to pay each other. In such a world, fraud protection would become an optional add-on.
Except the transaction isn't direct, it is mediated. You can't do a chargeback on F&F that's why I say the price of lower fees will be loss of protection.
Essentially every credit card transaction is an unsecured loan. You may get digital forms of cash, but there will be no fraud protection. That's okay for actual F&F, but i'm not sure I'd run a business that way. I'm also not sure I'd want to pay that way. Having the ability to chargeback as a customer also has value if I was sold a fake or damaged goods.
As I say, I think it's more complicated
I like cash the best but have taken checks at all the big shows.
There are transaction processors that provide protection against chargebacks. Signifyd is one. I believe they basically charge a 1% higher fee to cover the "insurance" against chargebacks.
LIBERTY SEATED DIMES WITH MAJOR VARIETIES CIRCULATION STRIKES (1837-1891) digital album
so why do they have counterfeit detecting pens lol
if I don't have cash I pay in cash