Accepting cash as a form of payment can have several indirect effects on a business’s revenue growth. Here’s how:

Broad Customer Reach

Accepting cash allows businesses to cater to a wider demographic, including those without access to digital banking or those who prefer physical currency. This broadened customer reach can lead to increased sales, thereby potentially boosting revenue.

Avoiding Transaction Fees

Cash transactions do not incur the processing fees associated with credit or debit card transactions. These saved costs can indirectly contribute to revenue growth by increasing the net income from each sale [1].

Improved Cash Flow

Cash transactions provide immediate liquidity, which can improve a business’s cash flow. While cash flow and revenue are different financial metrics, a healthy cash flow can support business operations and growth strategies, which could lead to increased revenue over time, [2]

Reduced Risk of Fraud

Cash transactions also reduce the risk of financial fraud such as chargebacks and disputes that can arise with digital payments. This reduction in potential losses can indirectly support revenue growth.

However, it’s important to note that while accepting cash can have these potential benefits, it doesn’t directly increase a business’s revenue. Revenue growth is primarily driven by factors like increased sales, price increases, or expansion into new markets. Accepting cash is just one part of a comprehensive strategy to support these revenue-driving activities.

[1] https://www.growthforce.com/blog/free-cash-flow-what-does-it-mean-for-business-growth

[2] https://www.investopedia.com/ask/answers/111714/whats-more-important-cash-flow-or-profits.asp