"Every time we swipe the card they charge us a quarter and then there's a percentage on top of whatever the sales is," explained Ed Sadler owner of Lil Cakes in Smyrna.
Customers who purchase a cupcake for as little as $2.99 can quickly make the bakery lose a profit.
"You wouldn't believe the people that come in that don't have cash for even one cupcake," Sandler told Nashville's News 2.
However, he said it's a convenience that he would not give up, especially since he expects the same of businesses he frequents.
"My wife and I, we don't carry cash as well, we just kind of forget about it because debit cards are so easy to use," Sandler said.
Retail experts advise credit card users should expect to start seeing credit card fees immediately, but customers will also see discounts for using cash.
Lil Cakes said they do not see a fee in their future.
"I don't think we'd ever consider doing that, I don't want to scare people away I want to get people to come to my store and buy things. I don't want them to come in and the first thing you see is a negative," Sadler said.
Some states have laws restricting fees for credit card purchases. It's unknown if Tennessee lawmakers are considering doing the same.