Bitcoin high transaction fees is a disadvantage to small business owners

[Kelward]

I run a small business and I receive payments for my goods in fiat currency. So joining this bitcointalk forum has really enlightened me about the advantages and gains of trading and investing with bitcoin. So going a step further, I decided that I want to place adverts that customers can have the option of making payments when they buy goods in my shop with bitcoin. But I decided to first seek the opinions of experienced people who are into bitcoin, they encouraged me to go ahead, also to be cautious of bitcoin high transaction fees. I did a little research on it and found out the inevitability of the high fees. https://www.makeuseof.com/what-are-bitcoin-transaction-fees/ 

My problem with these high transaction fees, is that customers naturally wants to minimize expenses, so if they choose to make payments with bitcoin, then they will want to exchange it at the exact rate of USD. So the seller bears the cost of the high fees alone, which may lead to selling at a loss. Although I'm guessing that the high fees might not affect big business owners, who receive payments in bitcoin, because they sell with higher profits, and when they minus the cost of the high transaction fees, it still won't affect their overall profits.

I feel that this is a big edge that fiat currencies have over bitcoin, because you don't have to pay extra to buy goods or services, even when you make fiat payments through banks, they only charge a token as transfer fees. So this high fees is a disadvantage to small business owners like me who has the intention of receiving payments in bitcoin.

[Zaguru12]

I feel that this is a big edge that fiat currencies have over bitcoin, because you don't have to pay extra to buy goods or services, even when you make fiat payments through banks, they only charge a token as transfer fees. So this high fees is a disadvantage to small business owners like me who has the intention of receiving payments in bitcoin.

Currently the issue of having bitcoin as a payment option in small scale businesses is actually hindered by the high transaction fee. The best of these option is to accept little payments in fiat and if you chose to invest them in bitcoin then you can buy them your self at later stage. The inception of the lightening network was actually the solution for fast and small transaction fee but it’s adoption isn’t growing rapidly as it would probably because some of the wallets do not support it just yet

If you use exchange like binance the easier way would have been using your pay or user ID but this also depends on the use to have same exchange and probably funds from it. So you can just add that too that People with the exchange can use that. But as you know the issue of centralized exchanges like this do not leave off your funds on them for long. Once they get to some quite significant amount you can withdraw them to your wallet. At least it will minimize the transaction fee

[coupable]

This is a great initiative and I personally would love for people to use Bitcoin for their daily small businesses. This will be the biggest incentive for the rest to dare to use Bitcoin.
It is good that you have thought about this point before you start accepting bitcoin payments. Indeed, it is a big problem for small businesses to accept payments in small amounts for everyday products. But there really is a solution to that that you may not have come across.
The solution is to use the Lightning Network, which enables you to make transfers in small amounts on channels parallel to the Bitcoin network, and then send all the amounts in one transfer on the main network. Here are some useful links:
How to use the Lightning network?
Lightning Network questions

[Faisal2202]

I do not know from which country you are but if Binance is available in your country then you could ask your customers to pay from Binance ID which will cost them nothing (free of cost transaction). I know many BTC user prefer to store there assets on non custodial or hardware wallets but still they will have some BTC in there exchanges too.

So you could ask them to pay you through your pay id, or you could make a QR code for yourself, i do not know if other exchanges also provide the same feature because it also has its limitations for example if a customer do not have account on Binanace exchange then you will have no other choice, so you have to find which exchanges provide this feature on your own.

No wonder, the transaction fee is so much for small business, but if you trust your customer so much, you should ask them to pay at the end of month, this the amount will be huge and your customer has to pay few dollars only. But it has its own limitation like customer could scam you.

Another way is. You only allow customers to buy things via BTC when they need to buy in bulk, in this way the amount will be huge and the customer will not feel the fee difference  snd they could happily pay the fee

[bitmover]

My problem with these high transaction fees, is that customers naturally wants to minimize expenses, so if they choose to make payments with bitcoin, then they will want to exchange it at the exact rate of USD. So the seller bears the cost of the high fees alone, which may lead to selling at a loss. Although I'm guessing that the high fees might not affect big business owners, who receive payments in bitcoin, because they sell with higher profits, and when they minus the cost of the high transaction fees, it still won't affect their overall profits.

I feel that this is a big edge that fiat currencies have over bitcoin, because you don't have to pay extra to buy goods or services, even when you make fiat payments through banks, they only charge a token as transfer fees. So this high fees is a disadvantage to small business owners like me who has the intention of receiving payments in bitcoin.

Bitcoin transaction fee might not be a problem if you transfer large values.

Many payment processors will charge you a percent of a transaction,  like 1%. Even PayPal will do so.

So it depends on what you and yours clients want. Bitcoin also gives the user more privacy.

[EarnOnVictor]

I feel that this is a big edge that fiat currencies have over bitcoin, because you don't have to pay extra to buy goods or services, even when you make fiat payments through banks, they only charge a token as transfer fees. So this high fees is a disadvantage to small business owners like me who has the intention of receiving payments in bitcoin.

Currently the issue of having bitcoin as a payment option in small scale businesses is actually hindered by the high transaction fee. The best of these option is to accept little payments in fiat and if you chose to invest them in bitcoin then you can buy them your self at later stage. The inception of the lightening network was actually the solution for fast and small transaction fee but it’s adoption isn’t growing rapidly as it would probably because some of the wallets do not support it just yet

If you use exchange like binance the easier way would have been using your pay or user ID but this also depends on the use to have same exchange and probably funds from it. So you can just add that too that People with the exchange can use that. But as you know the issue of centralized exchanges like this do not leave off your funds on them for long. Once they get to some quite significant amount you can withdraw them to your wallet. At least it will minimize the transaction fee

There is always good working around in such situations, and a while ago when I suggested Binance for small business payment here, some ill-informed people believed I was talking heresy due to their shallow understanding, not knowing that business is beyond whether or not you are using the non-custodial wallet, you should only try not to hold too much money there.

The fee and transaction completion time would at times be the issue for those accepting Bitcoin for payments. And to outsmart that, a big name like Binance could be of help since you would hardly see a person dealing with crypto nowadays without using a Binance wallet. This could help them to even pay for their goods and service for free.

I was thrilled 3 weeks ago when I wanted to fund a newly opened trading account with an Australian broker. The broker offers "Binance pay" and the transaction was fast, free and seamless. That's what we need this time, not only the LN, though it's also a good development, but still with its issues.

[Charles-Tim]

My problem with these high transaction fees, is that customers naturally wants to minimize expenses, so if they choose to make payments with bitcoin, then they will want to exchange it at the exact rate of USD. So the seller bears the cost of the high fees alone, which may lead to selling at a loss.

Bitcoin payment is optional, buyers should be responsible for the transaction fee, not you. If they do not want to pay with bitcoin, they can use fiat.

If you use exchange like binance the easier way would have been using your pay or user ID but this also depends on the use to have same exchange and probably funds from it. So you can just add that too that People with the exchange can use that. But as you know the issue of centralized exchanges like this do not leave off your funds on them for long. Once they get to some quite significant amount you can withdraw them to your wallet. At least it will minimize the transaction fee

What if you use an exchange and a customer pay you and Binance freeze the coin and said that it is tainted? Even if the coin is later released, it would have been a difficult time and it is going to stress you out to get your coins. Bitcoin gives the freedom not to depend on any central organization.

Many payment processors will charge you a percent of a transaction,  like 1%. Even PayPal will do so.

I think this will depend from country to country. Like in my country, local bank transactions are of very low fee, most do not require fee, but with little monthly charge. There are online microfinance banks and fintech with zero transaction fees, or zero transaction fee for certain number of transactions in a month, with not monthly charge.

I was thrilled 3 weeks ago when I wanted to fund a newly opened trading account with an Australian broker. The broker offers "Binance pay" and the transaction was fast, free and seamless. That's what we need this time, not only the LN, though it's also a good development, but still with its issues.

Binance Pay will encourage centralization and dependence on centralized authority. For this kind of shopping, lightning network has not two reasons it was created than this, to be able to spend bitcoin with cheaper fee and faster within a second or few seconds.

[redwine49]

This is a great initiative and I personally would love for people to use Bitcoin for their daily small businesses. This will be the biggest incentive for the rest to dare to use Bitcoin.
It is good that you have thought about this point before you start accepting bitcoin payments. Indeed, it is a big problem for small businesses to accept payments in small amounts for everyday products. But there really is a solution to that that you may not have come across.
The solution is to use the Lightning Network, which enables you to make transfers in small amounts on channels parallel to the Bitcoin network, and then send all the amounts in one transfer on the main network. Here are some useful links:
How to use the Lightning network?
Lightning Network questions

i think not many people are using lightning network and both of them must be the same network.
base on this
lightningnetworkstore there are 682 stores that use lightning network.
but it's slow adoption

[hatshepsut93]

I feel that this is a big edge that fiat currencies have over bitcoin, because you don't have to pay extra to buy goods or services, even when you make fiat payments through banks, they only charge a token as transfer fees. So this high fees is a disadvantage to small business owners like me who has the intention of receiving payments in bitcoin.

Fiat payment system have fees, but they are paid by merchants rather than the buyers. In turn merchants have to rise the prices.

Which system is more expensive depends on a typical transaction size. Bitcoin fees don't care about the monetary value of transaction, so when the fees are high, small transactions become unviable. But for large transactions Bitcoin can be cheaper, because 1% from $5,000 would be higher than a typical Bitcoin fee.

But without Lightning Network Bitcoin is not viable for commerce, simply because it's limited to ~300k transactions per day, while there are 8 billion people on Earth.

[Nwada001]

Since you are to start accepting Bitcoin in your shop and your shop is not selling heavy materials or goods that are worth hundreds of thousands in every single purchase, for me, I will advise that to be on the safe side, you will have to increase the minimum purchase amount that customers will be allowed to pay with Bitcoin. For example, anyone who is buying goods below a hundred dollars should make use of another payment method unless they will agree to pay the fee and not deduct it from the price of the goods. That way, you could possibly not incur any losses.

Or you can just suspend your Bitcoin payment option for the time being since the fee is still kind of high until it normalizes back to the lowest level where it was before. I believe that one is favorable for small business owners like you.

[chrisculanag]

For me, Bitcoin is not really suitable for business purposes because of what you say, the transaction fees are high and it takes a long time to arrive. There are many other cryptocurrencies that are better than Bitcoin. It's just that they have more confidence in Bitcoin's stability and longevity.

[Darker45]

It's actually a disadvantage to everybody save perhaps the miners to whom those transaction fees are paid. Even those large businesses will also be affected by high transaction fees. Although it's not much of a problem to the one who receives, it might affect the sales. Of if you are after those Bitcoin payments themselves, they will surely shrink. People will certainly be discouraged to pay in Bitcoin, unless they're provided with discounts high enough for them not to mind the fees.

Perhaps it's about time to integrate Lightning in your Bitcoin payment system.

[Husires]

Your problem is not with the transaction fees, as these fees can be closer to zero if the user uses the Lightning network to conduct his daily transactions to buy coffee or about 1% of item value for large payments for those who want to buy a smartscreen or new iPhone or other things whose price may exceed 500 dollar. Your problem is the fluctuation of exchange rates, as there are several price levels, and it is difficult to calculate the profits and losses due to the fluctuation of the exchange rate.
This problem can be solved by accepting stablecoins or using bitcoin payment processing services that transfer users' deposits directly to US dollars in your account.

Here is a list of Bitcoin Payment processors: https://bitcointalk.org/index.php?topic=5444578.0 from that list you can use CoinGate which support LN and Fiat conversion with 1% fees.

[killerfrost]

Bitcoin transaction fees can become a barrier for small business owners to accept Bitcoin as a payment method. Since Bitcoin's transaction fee value is evaluated based on the size of the transaction, larger transactions will have higher fees. This can especially affect small business owners, where transactions are smaller in value and therefore have higher transaction fees, than larger business owners.

It should be recognized that accepting Bitcoin as a payment method can provide many other benefits to small business owners, such as access to international markets, and avoidance of transaction costs. through traditional payment gateways. Besides, other alternative payment methods such as Lightning Network have also been developed to minimize the transaction costs of Bitcoin. Moreover, encouraging the use of bitcoin is not necessarily tied to the problem OP mentioned, I think there are many other crypto payment options to optimize fees, through the use of crypto will also help people know to bitcoin.

[crypticj]

Agree.

I don't really belive that businesses will adopt bitcoin. There are people who tried to accept bitcoin is their small business and every time they just abandoned this.

First one all, people don't want to use bitcoin as money. Everyone wants to invest in it and get rich.
And the second, government hates bitcoin, so they making it hard for people and businesses to use bitcoin in everyday life.

[Kelward]

I feel that this is a big edge that fiat currencies have over bitcoin, because you don't have to pay extra to buy goods or services, even when you make fiat payments through banks, they only charge a token as transfer fees. So this high fees is a disadvantage to small business owners like me who has the intention of receiving payments in bitcoin.

Currently the issue of having bitcoin as a payment option in small scale businesses is actually hindered by the high transaction fee. The best of these option is to accept little payments in fiat and if you chose to invest them in bitcoin then you can buy them your self at later stage. The inception of the lightening network was actually the solution for fast and small transaction fee but it’s adoption isn’t growing rapidly as it would probably because some of the wallets do not support it just yet

If you use exchange like binance the easier way would have been using your pay or user ID but this also depends on the use to have same exchange and probably funds from it. So you can just add that too that People with the exchange can use that. But as you know the issue of centralized exchanges like this do not leave off your funds on them for long. Once they get to some quite significant amount you can withdraw them to your wallet. At least it will minimize the transaction fee

There is always good working around in such situations, and a while ago when I suggested Binance for small business payment here, some ill-informed people believed I was talking heresy due to their shallow understanding, not knowing that business is beyond whether or not you are using the non-custodial wallet, you should only try not to hold too much money there.

The fee and transaction completion time would at times be the issue for those accepting Bitcoin for payments. And to outsmart that, a big name like Binance could be of help since you would hardly see a person dealing with crypto nowadays without using a Binance wallet. This could help them to even pay for their goods and service for free.

I was thrilled 3 weeks ago when I wanted to fund a newly opened trading account with an Australian broker. The broker offers "Binance pay" and the transaction was fast, free and seamless. That's what we need this time, not only the LN, though it's also a good development, but still with its issues.

Using  Binance, has also been suggested to me, that it is a better option to escape bitcoin high transaction fees. I would love to make the efforts to introduce my customers to the use of Binance, as an exchange in our transactions, but Binance is presently having an issue with SEC in my country. Nevertheless, I'll still keep the option in mind, pending when they resolve their matter.

Also, lightening networks is another option to manoeuvre this high fees, but frankly I don't understand how it works yet. I'll go through and diligently study the links that have been shared on this topic.

[Plaguedeath]

You should accept lightning network if you want them to pay with cheaper fees, although not all people are familiar with lightning network.

However you as an owner of your business don't have to force all of your customers to pay with Bitcoin, you just need to accept Bitcoin and give them an option to pay with the currency they prefer to spend. So if your customers buy a cheap product, they will pay with fiat, if they buy a lot products, they have an option either to pay with fiat or Bitcoin.

[Beparanf]

My problem with these high transaction fees, is that customers naturally wants to minimize expenses, so if they choose to make payments with bitcoin, then they will want to exchange it at the exact rate of USD. So the seller bears the cost of the high fees alone, which may lead to selling at a loss. Although I'm guessing that the high fees might not affect big business owners, who receive payments in bitcoin, because they sell with higher profits, and when they minus the cost of the high transaction fees, it still won't affect their overall profits.

I feel that this is a big edge that fiat currencies have over bitcoin, because you don't have to pay extra to buy goods or services, even when you make fiat payments through banks, they only charge a token as transfer fees. So this high fees is a disadvantage to small business owners like me who has the intention of receiving payments in bitcoin.

Even with SMES that selling low value item usually not advisable to use Bitcoin as mode of payment because of fee and the transaction speed. Lightning network is the solution but it’s not popular to many people which means only few accept this even on exchange.

I think the only time it’s good to accept Bitcoin as small business owner is if you will consider this Bitcoin payment as your long term investment and use your pocket money instead to replenish your business balance that goes to Bitcoin.

[CryptSafe]

OP, it is good that you are taking such a bold step to adopting bitcoin as a means of payment and I hope bitcoin is acceptable in your country where you are.
Before you do this I would advise you to do a proper in-depth analysis for your betterment before further implemention.

As we all know, transaction fees these days are something else and it would not be making any sense paying for a smaller good with a high transaction fee but rather buying a product of high price will be okay if paying for a transaction fee but we all know both parties involved in a business definitely have in mind to cut down expenses. So it all narrows down to the particular goods to be paid for.

[Queentoshi]

I run a small business and I receive payments for my goods in fiat currency. So joining this bitcointalk forum has really enlightened me about the advantages and gains of trading and investing with bitcoin. So going a step further, I decided that I want to place adverts that customers can have the option of making payments when they buy goods in my shop with bitcoin.

Not all businesses are suitable to receive payments in Bitcoins especially small business and depending on what is it that you sell. So before you even start to consider the option of receiving money in Bitcoins, first take a look at your business critically and come to a good conclusion if accepting payment in Bitcoins is what your business really needs, if it will help your business or you are doing it under the pressure from other business owners. I believe that there are other ways a business owner can help promote Bitcoins other than making it a means of payment in their business when their business is not suitable for it.