Research from payment company Worldpay shows 25 percent of UK shoppers avoid stores that don’t accept debit or credit card payments. That means up to 60,000 smaller stores and independents are missing out on potential custom.
Importantly, it’s younger shoppers who are most pro-card payments with almost two-thirds of those in the 23-34 age group saying they prefer not to carry cash. One in eight young UK adults carry no cash with the rest likely to carry less than 20 pounds. Despite this, almost 10 percent of smaller retailers don’t accept card payments while another 10 percent insist on a minimum spend when shoppers use cards.
Move from High Street to iStreet
Worldpay’s High Street To iStreet report showed that more UK high streets are switching to card payments with towns in the south adapting faster than those further north and in Scotland.
While some smaller retailers have traditionally resisted card payments due to what they see as high charges for terminals and for processing those payments, costs are coming down. The entry of Paypal into the sector with its PayPal Here service and similar services like Square have cut costs significantly.
Additionally, the rollout of contactless payment technology means that many shoppers who would previously have used cash for small transactions now prefer to use their debit cards or, less frequently, their Android-based or Apple smartwatches.
Worldpay MD Dave Hobday retailers must adapt to "digitally driven" shoppers as contactless and mobile payments have "raised the bar in terms of speed, simplicity and convenience".
Card spending outstripped cash in the UK for the first time last year but the market is well behind Sweden, which analysts are touting as the country set to become the world’s first post-cash society.
The Observer reported this weekend that in Sweden, with banks, buses, street vendors and even churches now taking plastic or virtual payment, consumers are increasingly not carrying cash at all and shops actually prefer to process payments digitally.
Niklas Arvidsson, an associate professor specialising in payment systems innovation at Stockholm’s Royal Institute of Technology (KTH), told the newspaper that he believes Sweden will be just about cash-free within five years.
Image: Worldpay website