Small Business Payments Study

Payments are a critical issue for small businesses, according to a new nationwide study of small business payment preferences.

October and November of 2006 saw just under one thousand small businesses with revenue of less than $5 million a year answer a myriad of questions related to payment systems.

The study found that, on average, small businesses receive an average of just over two hundred and fifty payments a month from all sources, predominantly paid by cash (25%) and checks ($40%), with nominal amounts paid by credit cards (16%) and PayPal (9%).

The research also showed that payments are a sore spot for almost sixty percent of all businesses polled, who use outside sources to deal with payment issues (such as accountants, business colleagues, financial institutions and payments processors).

“There is clearly an opportunity for financial institutions and payment processors to deepen customer relationships and offer specific services for the small business sector,” said Laura Fuller, a director with Dove Consulting and the manager of the study.