The Cashless Crusade: How UK Small Businesses Can Ride the Wave of a Changing Payment Landscape

There’s no denying it: 2020 was a rollercoaster year for UK payment markets, with the coronavirus pandemic shaking up the way we pay and transact like never before. For small business owners, staying on top of these trends is essential to meet customers’ evolving needs and stay ahead of the competition. So, let’s dive into the latest payment market insights and explore how UK small businesses can ride the wave of the cashless crusade.

The Great Payment Transformation of 2020

Amid a tumultuous 2020, total payments in the UK dipped by 11%, leaving a total of 35.6 billion transactions. But don’t be fooled – amidst this decline, several payment methods rose to prominence, leaving small businesses with new opportunities to seize. Let’s take a look at the key trends that emerged in 2020:

1. Debit cards dethroned cash: With 15.8 billion payments, debit cards secured their spot as the most used payment method in the UK.
2. Contactless conquers: Contactless debit and credit card payment volumes totaled an impressive 9.6 billion, proving that convenience is king.
3. Cash crumbles: Cash payments decreased by 35% to 6.1 billion, while Faster Payments and other remote banking methods soared to 3.0 billion.
4. Mobile banking momentum: A whopping 72% of UK adults used online banking, and 54% embraced mobile banking.
5. Checks check out: Cheque volumes dwindled, now accounting for less than 1% of UK payments.
6. Direct Debit stays steady: Direct Debit volumes rose by 1% to 4.5 billion, proving its resilience in a rapidly changing landscape.

Tips for UK Small Businesses to Thrive in the New Payment Era

So, what can UK small businesses do to adapt and flourish in this brave new world of payment trends? Here are some savvy strategies:

With contactless payments now accounting for a quarter of all UK transactions, it’s time to get on board the contactless bandwagon. Make sure your payment terminals are equipped to handle contactless cards and mobile wallets, giving your customers the quick and easy checkout experience they crave.

 Go Digital with Mobile Banking

As more and more UK adults turn to online and mobile banking, consider offering mobile banking options to your customers. Streamline your payment processes and offer digital receipts to meet the growing demand for seamless, convenient transactions.

 Cater to the Debit Card Dominance

Debit cards are here to stay, so make sure your business is fully equipped to accept them. Stay up to date with the latest in payment processing technology and ensure your payment terminals are compatible with all major debit card providers.

Prepare for the Cashless Revolution

While cash may not be disappearing entirely, its decline is undeniable. Stay ahead of the curve by preparing your business for a cashless future. Invest in digital payment options and consider offering incentives to customers who opt for cashless transactions.

Don’t Neglect Direct Debits

Direct Debits remain a popular and reliable payment method, so don’t overlook their potential in your payment arsenal. If you offer subscription services or recurring payments, ensure that Direct Debit is available as a payment option for your customers.

Stay Informed and Adapt

The payment landscape is continually evolving, and staying informed is crucial to your small business’s success. Keep an eye on industry news and emerging payment technologies to ensure you’re ready to adapt and meet your customers’ needs as they change.

In conclusion, 2020 was a transformative year for UK payment markets, with the pandemic driving a shift toward contactless, digital, and mobile banking options. By embracing these trends and adapting your small business to the changing payment landscape, you can not only better serve your customers but also stay ahead of the competition in an ever-evolving market.

As a UK small business owner, it’s crucial to understand the payment market trends to stay competitive and cater to your customers’ preferences. By following these tips and keeping an eye on the payment landscape, you’ll be well-equipped to ride the wave of the cashless crusade and ensure your business continues to thrive.