Every reasonable sized vendor has to do payment processing, whether it is depositing cash or checks. In addition to the payment processing, there can be clerical errors from underpayment. Checks may be returned for insufficient funds. All of these costs are a part of the operation.
Many vendors choose to use credit card processing to increase their business, reduce payment risks, and cut their costs, and to avoid being in the credit business themselves. Often they will charge something close to the fee that they are charged by their payment processor. Do they really want cash? Only if they are illegally under-reporting income. But for customers that worry about the 2-3% charge, they make it look like they are getting a better deal.
Streamlined payment processing is a win for most vendors and most customers. Each gets all of the processing done by someone else and gets periodic reporting as a result. I would prefer no cash always.
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