If you are reading this blog as a business owner, it will be exceptionally useful to you! Why is that? This blog explains the current market for payment methods including card and contactless payments but also the declining use of cash. The reason we are doing this is to try to help and support businesses as they are our customers and try to provide useful information for the general public and our consumers too.
Back in 2019, UK Finance reported that 51% of all transactions were made via card and contactless payment methods. This is something that would have been unfathomable 20 years ago, but that is how the market was last year – this is an impressive statistic for card and contactless payments. As a business owner, this figure alone may influence you to consider accepting these payment methods as it is over 50% of the market. You may be thinking this is a one-off figure and that card and contactless payments aren’t that dominant, but if you look back across previous years you soon see a pattern of behaviour that has meant card and contactless adoption has been on a steady rise. This is evident by this quote from Charged Retail – “The number of people not using cash, or using cash just once a month, more than doubled from 3.4 million in 2017 to 7.4 million in 2019” as you can see this is over a 50% jump of people not using cash or only using it once over the course of a month.
So to begin with the ‘elephant in the room’, the Coronavirus – this has had a drastic effect on payments as a whole but especially the decline of cash and the further development of alternative payment options such as eCommerce and contactless. As previously mentioned, cash was officially overtaken as the main payment source in 2019, this indicates that cash isn’t as dominant as it used to be; it is hard to imagine but some areas are already cashless societies. As shown by this quote by Finextra:
“Mastercard’s study reveals that 66% of UK transactions are contactless. Three quarters (76%) of Brits say they are very likely to continue using contactless payments after the pandemic ends, with 66% saying contactless payments are now their preferred way to pay when making purchases in-store.”
Due to this virus, the concerns with cash exchange and whether you can contract this virus from cash has meant that it has changed consumer habits and desires. Now that many shops have returned to the high street, consumers will venture in store but the coronavirus is still in the back of their minds, it’s a health and safety issue. Therefore, how many customers do you think you would lose as a business if they hear that your store hasn’t got contactless capability? This is something you need to consider, at the very least.
Another factor that we haven’t mentioned which is going to increase the number of purchases and the amount of money spent using contactless payments is the fact that the contactless limit increased from £30-45. This was something that was already in the pipeline but the coronavirus sped up this process and saw it implemented. This means that people can go into shops and pay for more items or buy more expensive items with contactless.
In conclusion, card and contactless payment methods have been on a steady and ever-growing upward trajectory and this doesn’t appear to be slowing anytime soon. These payment methods dominated even before the recent global pandemic we currently face, which will only increase their usage.
As a business, it is a difficult market already due to the safety concerns and the unknown of post-lockdown. However, card and contactless capability is one definitive thing that you can implement to maximise your business and ensure you are not missing out on sales.