A credit card is defined as a “small, thin plastic object that allows the holder to purchase goods or services on credit.” Today, credit card purchases are used for one-tenth of consumer payments made in the U.S. More and more consumers choose to use credit cards for purchases ranging from a $3 cup of coffee to a major appliance or an extravagant vacation. And while home improvement contractors are sometimes happy to take credit cards, they often prefer that customers finance jobs the old-fashioned ways: with a check or with some form of consumer financing.

Pros and Cons “We used to take credit cards,” says Ray Bendijo, owner of R&D Deck Builders and Construction in Ramsey, Minn. “But credit card company fees are too costly.” In fact, credit card companies often charge application fees, set-up fees, software fees, monthly statement fees — all in addition to 1.3% to 2.5% of the sales transaction (and sometimes a transaction fee).

Bendijo found traditional payment methods worked fine for his company when it stopped accepting card payments. “We didn't lose any business once we stopped,” he says.

Roland Ridgeway of Tri-State Remodeling in New Castle, Del., says that “the credit card system isn't set up for businesses like ours.” Tri-State installs windows, siding, doors, and roofing, and Ridgeway says that most of his customers have already saved their money for the project. Plastic works better for businesses that regularly take credit cards because fees decrease as usage increases. “It doesn't make sense for us to pay a 5% fee to use the service once a month. And our policy hasn't been a hindrance in our business at all.”

In Case of Emergency Those fees are OK for veteran roofer Rob Garrett, owner of Gambrills Roofing and Roof Mates Roofing Products in Gambrills, Md. He notes that accepting credit cards helps win jobs. “Sometimes, when you need a new roof, you need a new roof. And you need it right now,” he says, referring to situations like storm or accident damage. Accepting plastic keeps Garett from turning away customers.

So, there are different ways to deal with the credit issue. Most contractors agree that when it comes to payment, flexibility is important. The best policy is to give your customers the tools to pay for your services in ways that make the most sense for them.