While it can be easy for us to reach for our credit card in- store, all those processing fees add up, creating a burden on our small businesses as money trickles out of our local economy.
Credit and debit card processing fees can range from 2.5% to 4% of each transaction, and rates have recently gone up for many businesses this year. These extractive fees not only place a burden on our small businesses. Money trickling out of the area economy represents wealth leakage impacting our region as a whole.
The timely launch of digital BerkShares provides a cost-effective local alternative to mobile payment platforms and credit/debit card processing fees.
In her recent article for the Berkshire edge, Hannah Van Sickle summed up the issue by quoting Dennis Iodice, manager of Berkshire Mount Bakery (and a member of the BerkShares, Inc. Board of Directors):
Paying with digital BerkShares, as opposed to a credit card or other digital app, allows participating merchants to cut back on costs as opposed to passing them along to consumers over time. “Not only do you keep that full [transaction] amount in the local economy, but you’re also not paying out,” said Iodice of processing fees — to the tune of 2.6% of each transaction plus 10 cents a swipe — every time someone uses a credit card in the bakery. Even during the pandemic, when transactions at BMB nearly doubled, “we never got breaks,” said Iodice who, when attempting to renegotiate rates over the past two years, was met with “we don’t do that” — leaving credit card companies to prosper while many in the region struggled to make ends meet.
With digital BerkShares, individuals can shop local and also pay local — keeping the Berkshires at the forefront of local currency innovation.
- Since its inception in 2006, BerkShares has kept more than $10,000,000 in local circulation.
- Digital BerSkares are free to accept and spend. The modest 1.5% fee when cashing out to USD is lower than credit or debit fees (and competitive with big-tech payment apps).
- All BerkShares remain backed by FDIC-insured US dollar reserves at our local community banks.
So next time you’re shopping local, consider asking the business what their preferred method of payment woudl be. And, if you’re in the Berkshire region, ask whether or not they’ve considered accepting BerkShares.
