This year, card payments overtook cash payments as the main method of purchasing in the UK. With 1-in-6 Brits now only using cards to pay and six-in-ten of us saying we would spend more in each business because they have card payment technology, it’s surprising that there are still estimated to be 3 million small businesses out there that do not take card payments at all.
Out of this estimated 3million, there will no doubt be many businesses for whom card payments are irrelevant; many B2B businesses especially trade wholly through bank transfers and cheques for example. However, there are plenty of B2C businesses who don’t accept card payments for one reason or another, and they could be missing out on a big opportunity to increase their revenues.
For more on this story, see http://www.telegraph.co.uk/business/2017/10/01/three-million-small-businesses-still-dont-accept-cards-despite/
The rise of fintech
Fintech is constantly developing and credit in one form or another has always been a thing – even before the introduction of the ubiquitous plastic credit card in the 1950s. Recently, the introduction of chip-and-pin, and also contactless payments has opened up cashless transactions to more and more people.
Payment technology now includes more than just credit cards. Payment can also be made through phone apps such as PayPal or through wearable tech like the Apple Watch. No doubt the processing of payments using fingerprint or voice recognition tech won’t be too far away.
Why you should think about using card payment technology
If you don’t accept card payments then you could be missing an opportunity. With fewer of us carrying enough cash to cover anything more than a minor purchase, often carrying a debit or credit card with us is our only payment option. If you run a shop or a consumer service and you don’t have card payment technology, you could lose out on a sale to a competitor that does.
The only real disadvantage of having card payment facilities is the cost. Card readers cost money both to purchase and run, or to hire. The card payment companies have to make their money somehow; usually they will take a % of your transactions for themselves. These charges can vary so shop around to get the right deal for your business.
The advantages of card payment technology
There are however several advantages which could well outweigh the cost of a card payment machine
The most obvious advantage is a potential increase in custom and expenditure. With many people saying they would avoid businesses that don’t allow card payments, you should see an increase in custom once you offer more convenient payment facilities.
Secondly, you will have less cash on your person or your premises. This means you could become less of a target for opportunist thieves. If you are a window cleaner, for example, it’s easy to see how you could lose a whole week’s takings in one hit if you were carrying the cash your customers have given you and you were targeted by a thief. The same could apply to many businesses, such as shops, salons, or mobile food vans.
Taking only cash means having to visit the bank to deposit your takings. You could keep the cash and pay your suppliers with it instead, though most would probably prefer a bank transfer or card payment themselves. Traipsing to the bank with a couple of days’ worth of takings a few times a week could start to get time-consuming, and increase your security risk further.
Investing in card payment technology
Rather than seeing card payment transaction costs as a penalty for accepting card payments instead of cash, you should think about the small percentage as an investment, both in customer satisfaction and business security.
Really, adding card payment facilities to your business is about giving your customer the choice of whether they are happy to pay in cash or would rather use a card. Giving them this choice is improving their experience with you. With current growth rates, it’s easy to see how all payments in the future will be cashless – make sure your business is still around to see it!
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