Do you feel like you were meant to have a kick-ass career as a hairstylist? Like you got into this industry to make big things happen? Maybe you’re struggling to build a solid base and want some stability. Maybe you know social media is important, but it feels like a waste of time because you weren’t seeing any results. Maybe you’ve already had some amazing success, but are craving more. Maybe you’re ready to truly enjoy the freedom and flexibility this industry has to offer. Cutting and coloring skills will only get you so far, but to build a lifelong career as a wealthy stylist, it takes business skills and a serious marketing strategy. When you’re ready to quit just working in your business and start working on it, join us here where we share real success stories from real stylists. I’m Britt Siva, social media and marketing strategist just for hairstylists, and this is the Thriving Stylist Podcast.
What is up and welcome back to the Thriving Stylist Podcast? I’m your host, Brit Siva, and today we’re talking about the cash only trend that had the industry in a choke hold in September and October of 2026. So fall of 2026, there was a slurry of Instagram posts that floated all around the industry and ultimately into my DMs over and over and over from stylists who were deciding that they were no longer going to be accepting payment by credit card. And the reason for shifting to essentially a cash-only business was that they didn’t want to have to pay credit card fees. And what happened was these posts went viral. It seemed like a trend that every stylist and salon was interested in getting behind. Unfortunately, there was a lot of confusion around what was happening there, and the posts that we were seeing, if you’re here in the US with me, weren’t necessarily meant for our eyes.
And what happened is I think a lot of industry professionals didn’t realize that the stylists and salons making these posts at scale were not US-based. And it was actually an incredible social experiment, if you look at it from that angle, in the fact that a lot of stylists and salon owners would see this post and be like, “This is amazing. I’m so glad this industry is doing this. I’m gonna do this too.” Without even clicking on the name of a poster and seeing where their location was, without even digging into the why behind this, they just saw a trend that they liked and though, “Amazing. If these people are doing it, I’m gonna do it too.” And it was such a great example of how easy it is to get caught up in misguided business advice. And for anybody here in the US who jumped on this trend or is thinking about jumping on this trend, I want you to stop in your tracks and listen to this episode because it’s not what it appears.
So this first hit my radar end of September 2026 when I got a few dozen Instagram posts sent my way. I’m gonna read to you a couple of them. This first one is a carousel post and the cover photo says a little payment update. From October 1st, we’re gonna be making a small change to the way we accept payments in the salon. We’ll be moving away from EFTPOS payments, which is essentially credit card payments. Our payment methods forward will be cash and bank transfer. Simple, easy, and transparent. Why are we making the change? With changes around credit card surcharges and the increase in cost small businesses absorb behind the scenes, we’ve made the decision to move away from EFTPOS. Rather than adding additional costs into our pricing, we feel this is the fairest way to keep things simple and transparent for both of our clients and our business.
We know it might take a little while to get used to, so we’ll be reminding you before your appointment as we get closer to the change. Thank you for continuing to support our business, our incredible team, and our little business. Every appointment genuinely supports the people behind our chairs. We appreciate you more than you know. Now here’s another one. Also a carousel post and it says, “Apparently the banks need more money from us.” Respectfully, F that. From October 1st, businesses can no longer pass on EFT POS payment surcharges. To be honest, I’m overpaying fees to the banks and payment providers every time someone pays me for a service. I’m a small business and I’m still looking at around $2,000 a year in fees. So instead of increasing my prices to absorb those costs, I’m going back to the analog times, LOL, cash or bank transfer.
I’m not trying to make things harder for you. It’s about keeping more of your money and more of my business income where it belongs. Between the client and the small business, not in the pockets of the big banks. You will still have the option to pay by card if you need to, but from the 1st of October, cash or bank transfer will be my preferred method of payment. I encourage you to use cash where you can to support local small business. That second post has 4,200 likes and 159 shares. They’ve actually turned comments off. I don’t know the reason. The other one that I shared with you, they hid their likes, but they have 94 comments and 592 shares. Those are just two. I got over a dozen in total and you can see, I mean, they spread like wildfire and when you see and hear something like that, it sounds great.
None of us want more of our money going to banks. If you look at how much money a bank gets a year in surcharges from credit card-based transactions, it’s billions of dollars. And so all of us as local small business owners are like, “Man, we are just trying to get by and you are cashing in by doing nothing. All that’s happening is a card’s being swiped and the bank is making money.” All of us would love to keep more of that. So when these posts went viral and stylists and salon owners started seeing them, I looked at the comments under these posts and there were tons from US-based stylists and salon owners like, “I love this. I’m jumping on board.” There is a very specific reason why Australian salons and stylists decided to do this, and that’s where the trend started. They had a change in their legal guidelines that went into effect October 1st, which is why you’ll see on all of these posts that October 1st was the day all of these stylists and salons
So here’s what actually happened. October 1st, 2026, Australia banned card surcharges, so businesses can no longer add on a surcharge fee when a client was paying by card. We see this happen in the US. Sometimes a small business will pass along the card surcharge fee to the client, meaning that the overall service bill would increase by anywhere from one to 4% to cover the additional costs of the credit card transaction. Well, Australia decided that was going to be completely illegal. And what they did in exchange, which I don’t see any of these posts talking about, is they reduced the surcharge being charged. So for credit card bank fees, before it was a 0.8% charge in Australia, now it is a 0.3% charge. For debit cards in Australia, it was 10 cents or 0.2%. Now it’s eight cents or 0.16%. So they rolled it out as if it was a compromise.
The way this was rolled out, for businesses that were not passing on credit card charge fees to clients, they’re actually coming out ahead. All they’re doing is saving money. There’s no negative repercussion. The only businesses that were impacted by this were the estimated 16% of merchants in Australia who had been passing along credit card fees to their clients because that has now been deemed illegal. Now what was interesting about this choice and this change is 75% of Australians were in favor of this change. And knowing that 84% of business owners were not passing that fee along at scale, most small businesses in Australia were really happy about this. It was only the ones that were passing along the fee that were not. So I asked myself, would this happen in the US? If it did, would the impact be different? In the research that I found, it does not look like legislature like this is even being considered in the US.
So the thought of passing on fees becoming truly illegal at scale is not even on the horizon at this time. That being said, there are certain states in the US where already you cannot do that. Connecticut, Massachusetts, and Maine, it is illegal to pass along credit card fees to your clients at this time. When you look at Colorado, Oklahoma, New York, New Jersey, Minnesota, California, there are caps and limitations. So it’s not something that you can just do whenever you want to. There’s also law and regulation around how you have to post and advertise your pricing if you are going to pass along a surcharge to your clients. So it’s not something that you can just choose to do or roll with it. You have to make sure that you’re doing it legally. So let’s look at the pros and cons of a decision like choosing not to accept credit card at all anymore and/or debit card even because there’s fees on those swipes too.
Let’s say we say, “No more plastic in my business. I want cash and bank transfer only.” An example of bank transfer would be like Zelle payments. That’s a bank transfer payment. So let’s say you decide, “You know what? That’s what we’re doing, not credit card. I like this. I don’t wanna have to pay the credit card transaction fees. I just wanna be cash only.” Let’s weigh it out in full. Pros, you wouldn’t have to pay for those processing fees. In the US, generally, when I’m looking at my salon owners’ P&Ls, we’re seeing anywhere from 2.5 to 3.5% in credit card processing fees when we look at gross revenue produced. Also, money would be available immediately. Right now, if your client pays by credit card, usually that revenue is floating in the ethos for a couple of days until it actually hits your bank account. There would be no chargebacks.
So we are living in a time where clients are getting their hair done and then going to their credit card provider and saying, “Well, I want a refund. The service wasn’t redeemed,” or whatever it was. And clients are sometimes getting that money back. They can also fight back on cancellation fees and deposits, things like that. You’d eliminate that completely. And then of course, some people might see this as a pro. For me, I would never advise to it, but I know the temptation is when you’re running a cash only business, it’s easier to pay less taxes. You can take some of that cash and not claim it. To me, that would be incredibly reckless. If you don’t claim it, it doesn’t count. If you ever want to buy a car or buy a home or get a loan to expand your business or anything like that, if the cash has not been reported, it doesn’t count and it doesn’t help you to grow as an adult making big adult decisions if you’re not claiming all of your cash.
But I know for some people they would see that as a pro, so I just wanna acknowledge that I’m sure some people would see it that way. To me, the cons outweigh the pros. First things first, there is virtually no way you wouldn’t lose some clients. When you become cash only or bank transfer only, anybody who does not have full value of their service in their bank account today now cannot pay you. So they either have to cancel their appointment, which could end up being a last minute cancellation because maybe they though they were gonna have the money and they didn’t make as much as they though they were going to this week and now they can’t afford a $280 color service because they don’t got it. So they could either come in and give you an IOU or they could cancel their appointment altogether because they don’t have the money to pay for it.
That is tough, especially for people who have more expensive service tickets. When you’re an extension specialist or even a color specialist, not everybody has an extra $180, but if I can pay for that today and my paycheck is coming in two days, I can put it on my credit card and know that I’m good to go. The vast majority of Americans are in debt. This is a living paycheck to paycheck kind of world we’re living in. And so to say I’m only serving clients who have an abundance of cash, you are limiting yourself to a clientele who more than likely is operating at a higher price point and is very cashflow positive. The irony is that person is more than likely not interested in paying with cash. A lot of people who are in that bracket are racking up credit card points or want to have a detailed transaction list of everything they spent for the month for a lot of reasons.
A lot of people just choose credit card even when they have the cash. You are completely eliminating those people from your clientele. Next, checkout just gets harder. I shared on the podcast a few months ago verbiage for what to do. If a client comes in, the service is over and now they claim they can’t pay. My daughter experienced that. She had done a client, a full color service. I don’t know what the ticket was, over 200 bucks. And the client was like, “Oh shoot, I left my credit card at home. Can I pay you later?” And she panicked and was just like, “Yeah, yeah, pay me later.” And she called me and she was like, “Now I can’t get ahold of this person. She’s not responding to my text. What am I supposed to do?” And I was able to walk her through it. But what would you do in that instance?
If a client is there, the service is done, and now they’re like, “Oh yeah, so by the way, I just checked my bank account and I don’t have any money. Can I pay you in a few days?” And the impulsive solution is to be like, “Oh, well, I’ll just have everybody pay for their service before I even start.” Okay. Yeah, let’s say you do that. You have them pay for their service before they start. It is a little bit of a backwards service standard, but you could try it. So let’s say the client sits there and you’re like, “Okay, and so now I accept payment before the service begins.” The same thing is gonna happen. They’re gonna go to their bank account and be like, “Oh, sorry. I though I was gonna get paid yesterday, but I didn’t. What do we do now?” Well, you have two choices.
Do their hair and hope they pay you later or send them packing and now you have two and a half hours dead time on your calendar. You are limiting the ability for people to pay you to avoid a two to 3% surcharge. It’s a really big decision to make. Now, the other thing is risk of audit. When any business goes from claiming a certain amount of revenue to a significant loss, and the IRS defines significant loss, of course, in a really broad way that can be interpreted however it wants to, could they decide a 15% revenue loss is significant? Maybe it’s 50% or more. But let’s say you do decide to go cash only, and you decide you’re not gonna claim all of that cash. If the IRS is like, “Well, this is pretty weird. This used to be a business that had a lot of credit card transactions and was making this amount of revenue, and now all of a sudden they’re a cash-heavy business and the revenue is dropped by 30%,” it’s like you’re asking for an audit.
And in an audit like that, they’re gonna go through all of your tickets and check through everything. It becomes an accounting nightmare to do it that way. My bigger concern when we’re looking at making a decision like this is how do we make the business more stable and less fragile so that a two to 3% surcharge doesn’t send us over the edge? If a two to 3% surcharge is this painful, we’re likely running on a profit margin of less than 5%, which is very scary. And so instead, I would say what changes need to happen to the business so there is more cash flow, so that that two to 3% charge isn’t as painful. Nobody likes paying credit card charges, I totally understand. But I remember years ago, probably eight or 10 years ago, I filed my taxes with my CPA and he told me how much I owed and I turned into such a big whiny baby.
I was so mad and so frustrated and I was like, “Why do I work this hard just to pay the IRS all this money?” And he said, “I’m gonna let you have this tantrum one time, and I’m not gonna do this conversation with you again because millions of people would be so fortunate to have had a business successful enough to have a tax bill like the one you’re facing.” Paying taxes sucks. I’m sorry you have to do it, but when you have a business that owes that much amount of money, it means you’re doing really freaking well for yourself. So take 24 hours, pitch a fit, and then realize if you are paying such high fees, it means you are running an incredible amount of revenue and you should be grateful. And if we need to find a different way to strategize the margin, let’s do that.
I want you to think about that for a second. If you are a business that’s paying 2,000, 10,000, $40,000 a year in credit card fees, you are running tens of thousands or hundreds of thousands of dollars in revenue. It stinks to have to give any of it away. It is the cost of scaling a business. And what we do in the coaching programs I have is we look at how to ensure your business is structured to turn plenty of profit so that a 2.5% credit card fee, while annoying, doesn’t sink your ship, versus choosing to not accept credit cards anymore and potentially alienating 10, 20, 30, 40% of your potential viable clientele who just can’t do a cash only business. Now, if you want a hybrid alternative to this, what you can do in the US and what some businesses definitely do, is offer a cash discount.
Now, what you can’t do is say it costs more if you pay credit card. That verbiage is actually illegal. But if you say, “The price for my haircut is $100, if you choose to pay cash, it’s only 95.” That’s legal. You can do that, but you can’t say, “My haircut’s 95. If you pay card, it’s 100.” You can’t position it that way. So there’s a lot of nuances to the positioning. You see gas stations doing this all the time. That’s the most common business I can think of where I see it constantly. If you go in and you’re a cash pay customer, you save a few cents per gallon. You are within your realm to do that. So if you’re somebody who’s like super annoyed with the credit card fees and you’re like, “I don’t wanna do this anymore. I’m sick of seeing that 3%,” you can trial run a cash discount for clients.
It becomes a little clunky in our industry because for most of us, the bill is presented at the end. And you would say, “Hey, your total for today is 280. I don’t know if you know, but I have a cash discount. It reduces your fee by 5%. I don’t know, whatever you decide, 3%, whatever. And so if you were to pay by cash instead of card, your price would be reduced to X.” And some clients would totally go for it, and that’s a nice hybrid way to do this if you want to. That being said, you might not come out that much ahead. If you are discounting even a portion of your clientele by two to 3% to avoid that credit card transaction fee, how are you coming out ahead on something like that? The math doesn’t really math on it. So instead, I invite you to take a bit of the advice that my CPA told me and learn to look at credit card transaction fees a little bit differently.
They are a part of business. Do some parts of business suck? Yes. Do taxes suck? Yes. There’s a lot of things I would love to change. What I want you to do and what I want the takeaway from this episode to be is to really think long-term about what makes sense for your business, to never make a decision that could potentially alienate clients, to work with a coach or a guide or a system who can help you to increase your profit margin so a two to 3% credit card charge doesn’t sink the ship, and to slow down when you see trends on the internet, because sometimes it is hard to decipher what messaging is for you and what messaging really doesn’t impact you. It’s easy to get caught up in the hype. It’s easy to choose to do something in your business because it sounds good on paper, it looks viral on social media versus slowing down, taking a look at yourself, asking what your goals are, looking at your clientele and asking what makes sense for you.
All right. So much love. Happy business building and I’ll see you on the next one.
