Small businesses embracing contactless payments

Research published in September 2021 by Visa, on the global impact of COVID-19 on small businesses owners, should encourage small business owners to adopt new ways of working and convince them to embrace contactless payments, not only to survive and prosper but to meet customers’ expectations.   

• 68% of consumers say COVID-19 has permanently changed how they will pay for things, with a preference for touchless methods.
  
  
• 67% of consumers expect brick-and-mortar retail stores to accept contactless payments.
  
  
• 74% of small businesses expect that in the future customers will prefer contactless methods as much, or more than they do now.

*Source – The Visa Back to Business Study – 5th Edition, conducted between June 15 and June 28; Published, September 2021.

Contactless payments and the consumer

Contactless has become the payment method of choice for many consumers in the UK, with contactless payments accounting for 51% of all credit cards and 66% of all debit card transactions in June 2021, a whopping 92.4% higher than June 2020. With 1,169 million contactless card transactions in June 2021, 73.8% more than the 673 million in June 2020, the scale of spending using contactless methods is a clear indicator that small businesses need to ensure they are set up to accept payments with a contactless card machine.

*Source – Card Spending Update for June 2021, UK Finance: Published, September 2021.

Mobile and smart device payments

A report from UK Finance states that growth in using mobile phones and smartwatches to make payments lept to nearly a third (32%, 17.3 million) of the UK adult population registering to use mobile payments by the end of 2020.

*Source - Contactless now accounts for more than a quarter of all UK payments’: Published, June 2021.

Contactless payment benefits for small businesses

Most small businesses are now able to accept card payments, but for those who have been reluctant to take on a merchant account, there are many good reasons to get set up to accept payments by card, here are three of the best.

• The World Health Organisation has recommended that to reduce the risk of transmission of COVID-19 and other viruses, cashless electronic or mobile payments should be the preferred option for consumers and businesses.
  
  
• Your customers expect to be able to pay using contactless methods and may shop elsewhere if the facility to do so is not available.
  
  
• It has never been easier to set up a merchant account, and you can be up and running within days.

Contactless payments and the small business owner

Small business owners in every sector are being affected by the trend for consumers to pay using contactless methods, and with the contactless limit increasing to £100 on October 15th 2021, it is likely that the trend for contactless spending will continue.

Read our blog: Increase in consumer spending expected as contactless limit goes up.

The outlook for small businesses that accept contactless payments using card machines is positive, with customers expecting businesses to provide a means for them to pay with a quick tap, indoors or outdoors.

Customers still pay by cash

According to The UK Finance report*, cash is still relevant and whilst the number of cash payments in the UK fell by 35% in 2020 and was used for 17% of all transactions, it remains the second most frequently used payment method behind debit cards. Consumer choice will dictate the method they use to pay, and it is essential that when a customer chooses to spend with you, they have as many options as possible available.

*Source - Contactless now accounts for more than a quarter of all UK payments’: Published, June 2021.