Just As Credit Cards Displaced Paper Money, Crypto Payment Services Will Replace Plastic

In many parts of the world, the use of cash for everyday payments has become something of an oddity, with the vast majority of consumers and merchants preferring the convenience of credit cards and electronic payment methods.

Each day, millions of consumers all around the globe make payments simply by swiping a credit card at the checkout counter.

The use of credit cards has become a ubiquitous element of the modern shopping experience, and those who prefer to scrabble through their handbags looking for loose change have become a very rare sight, especially in places like Sweden, which has ambitions to become the world’s first fully cashless society.

The rise of credit cards is justified by the fast and convenient experience they provide, with significant advantages for consumers and merchants alike.

But these benefits come at a cost that’s almost always paid for by the consumer, and although most fees are relatively low, they can add up significantly over the course of a year.

Fortunately, more consumers can take advantage of a new, lower-cost alternative with the rise of crypto payment services such as Slash Payment.

The Cost of Credit Cards

Credit cards have become so commonplace that it’s easy to forget that such a service comes at a cost.

Every time a consumer swipes their card, the merchant has to pay a processing fee, which raises the cost of doing business in such a way that everyone is negatively affected.

One thing that many consumers fail to appreciate is that credit card companies apply not one, but three separate transaction fees to merchants. In order to accept credit card payments, merchants are required to pay processing fees on each transaction, as well as interchange fees and assessment fees, and the costs of these add up to a not-insignificant charge.

These fees go to the payment processor, the card’s issuing bank and the payment network, respectively.

According to The Fool, the standard processing fee charged to merchants ranges from 1.15% to as much as 2.15%, depending on the credit card provider.

In addition, they also have to pay interchange fees of 3.15% on each transaction, plus an additional 0.13% to 0.17% in assessment fees. All told, the average credit card transaction fee works out at around 3% to 4% of the total purchase amount.

That may seem pretty low, but for a merchant that’s processing hundreds, if not thousands of these transactions each day, it pretty soon adds up to thousands of dollars – and is considered an essential cost of doing business.

This means that over the course of a year, the consumer also has to pay considerable costs.

While some countries have laws in place to prevent merchants from passing on these fees to the consumer, there are loopholes that allow them to do precisely that.

After all, they can simply increase the price of the products they sell as a way to cover these costs. As such, the consumer almost always loses out.

Credit card transactions are a big earner for the issuing bank, payment processor and network providers, with data from the Merchant Payments Coalition showing that these companies made a collective $126.4 billion from these fees in 2022.

Crypto As An Alternative

The good news is that consumers aren’t restricted to credit card payments alone in a cashless society.

While plastic remains the most popular modern purchasing method, there are alternatives such as mobile payment apps and, increasingly, crypto payment services.

The latter might still be fairly rare, but they are growing in popularity as they provide some strong advantages to the consumer. Crypto has become attractive to many consumers because they see it as a better form of money.

Its decentralized nature makes it more accessible and equitable, and although many cryptocurrencies can be volatile, most people see it as a good long-term investment.

Zoom out over the long term, and we can see that the price of all of the major cryptocurrencies today – such as Bitcoin, Ethereum, Solana etc. – have appreciated in value.

Crypto payment services such as Slash Finance, which has become extremely popular in Japan, provide significant advantages to consumers. For one thing, the associated transaction fees are much cheaper than credit cards.

Slash charges anything from 0% to a maximum of 2% per transaction, depending on the cryptocurrency used by the consumer. Merchants are never charged any fees, so there’s no way any hidden costs can be passed on.

Users can choose to pay in over 1,000 supported cryptocurrencies on dozens of supported blockchains, including the newly-added Oaysys chain, but the merchant will always receive a stablecoin such as USDC, USDT or DAI.

When someone makes a payment, Slash will leverage the decentralized liquidity of dozens of supported decentralized exchange platforms to find the most affordable exchange rate, and then perform a swap in the background.

The stablecoins are then deposited into the merchant’s wallet, without any fees being charged.

What’s more, this happens almost instantly, so there’s no need to wait for the payment to be processed, as is typical with standard Bitcoin transactions, for example.

Slash Payment has grown to support more than 1,400 digital assets across five supported blockchains, and is becoming widely accepted in various e-commerce and physical stores access Japan, a country that has embraced cashless payments.

It can be thought of as a crypto version of something like PayPal or Stripe, and merchants can easily integrate it into their point-of-sale via API or QR code.

Having recently secured backing from the Uniswap-Arbitrum Grant Program, its crypto payments service is likely to grow even more in the coming months.

It’s notable that Slash Fintech Ltd., the company behind Slash Payment, is also committed to preventing money laundering and terrorist financing, having achieved compliance with global Anti-Money Laundering and Countering the Financing of Terrorism rules, as well as various Sanctions laws.

The Future Of Cashless Will Be Plastic-less

Credit cards have become extremely popular for good reasons, transforming the consumer purchasing experience and making life much more convenient.

But these benefits come at a considerable cost to the consumer, meaning there’s potential for a better solution.

As cryptocurrencies become more mainstream, it’s likely that crypto payment services will become much more omnipresent than they are now, because they share the convenience of credit cards but reduce the cost of transactions by a significant degree.

Before long, the use of credit cards at a checkout may become as much of an oddity as the use of paper money is today.

Few consumers will want to use such an outdated payment method when superior, more affordable options are available.

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