Beyond Cash: What Drives SMB Payment Change

Small and medium-sized businesses are still relying heavily on cash and checks, but PYMNTS Intelligence data shows that many are ready for something better. What is holding them back is not resistance to change. Instead, it is access to the right credit products, concern about cost and a need for digital tools that match how they run their businesses day to day. The five data points below capture where that shift is happening and what it will take to move it forward.

The SMB Payment Shift

Cash or Check?

Gen Z-led SMBs are the most cash-heavy, underscoring how payment habits often reflect business realities more than preferences.¹

Fifty-two percent of payments made by Gen Z-operated SMBs were made in cash, versus a 32% average across SMBs. The same chart shows checks remain just as entrenched overall, accounting for 37% of payments on average. This points to a split market in which younger firms lean on cash while older, larger ones continue to depend on checks.

SMB Cash Reliance

The businesses most tied to cash are often the ones most ready to leave it behind.

Forty-five percent of SMBs say they are very or extremely interested in reducing their reliance on cash. Interest is even stronger among Gen Z-owned and -operated firms at 68% and construction or utilities firms at 59%, showing that the businesses feeling the most friction from cash are often the most open to alternatives.

SMB Access Gap

Many SMBs still do not have business credit cards that could help them move away from cash.

Six in 10 SMBs have a business credit card, but access is far from even. Only 22% of Gen Z-led firms, 36% of those in rural areas and 37% of the smallest businesses have one. The result is that many of the businesses most in need of flexibility remain stuck with older payment methods.

Card Value

SMBs see credit cards first as tools for protection and cash-flow flexibility.

Sixty-three percent of SMBs say credit cards are the best method for disputing a payment and getting money back, while 59% say cards are best when they need to make a payment when they don’t have cash on hand. That makes it clear that cards are not viewed only as payment tools. They are also seen as a way to reduce risk and manage timing.

Human Backup

SMBs want digital tools, but many still want a real person when it matters.

A self-serve digital application is the top service choice for 23% of SMBs, but live chat and a human phone representative are close behind at 18% each. Among high-cash-reliance SMBs, phone support rises to 25%, indicating that adoption depends not just on digital access but also on trust and human support.

Methodology

“Beyond Cash: What Drives SMB Payment Change” is based on findings from the February 2026 edition of the SMB Growth Report. PYMNTS Intelligence surveyed 412 SMB decision-makers, including owners, founders, vice presidents and executive directors. The survey was conducted from Dec. 2, 2025, to Dec. 20, 2025, and examines how SMBs pay vendors and suppliers, how much they rely on cash and checks, and how they view business credit cards as an alternative.

^{1. PYMNTS Intelligence uses the following approximate birth dates and approximate age ranges in 2026 for generational cohorts: baby boomers: born in 1964 or earlier and now aged 62 or older; Generation X: born between 1965 and 1980 and now aged 46–61; millennials: born between 1981 and 1996 and now aged 30–45; bridge millennials: born between 1978 and 1988 and now aged 38–48; zillennials: born between 1991 and 1999 and now aged 26–35; and Generation Z: born in 1997 or later and now aged 29 or younger.↩}