A new report from Square has found that there's been a dramatic increase in UK businesses going cashless using its payment processing (opens in new tab) technology over the past 12 months.
The rapid rise of cashless payments (opens in new tab) has been accelerated by the coronavirus pandemic. Data produced for the report reveals that a year ago just one in ten UK businesses signed up for Square services were cashless.
Twelve months later and almost five in ten have ditched the cash and have moved over to digital payments. Square’s Cash and the Pandemic 2.0 report indicates a continuing trend towards businesses accepting a more diverse range of payment acceptance options.
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Businesses are being encouraged to embrace contactless payments and update their point of sale (opens in new tab) (POS) systems so they can process a wider variety of transactions, including those made using digital wallets (opens in new tab). Square’s findings reveal that comparing February 2020 to February 2021 the share of businesses accepting online payments using its services has nearly doubled.
Many businesses have carried out the transition quite recently, with 21% of those accepting online payments via Square systems making the move during or after March of last year. Unsurprisingly, specific sectors have made more of a concerted effort to move away from conventional cash such as retail outlets along with food and drink sellers.
Square has bolstered its report findings by commissioning additional consumer research, which revealed that a fifth of consumers have tried a new payment method since the pandemic. Over a third (33%) have since adopted contactless payments and, with the contactless limit rising from £30 to £45 some 44% of consumers said that it was now their preferred payment method.
However, 53% of British consumers surveyed also stated that they’d like to see conventional cash remain in order to give them a broader range of payment options. It suggests businesses that are able to offer multiple forms of payment processing (opens in new tab) will be better placed to see return visits from customers.
“The pandemic has been an unprecedented challenge for small businesses across the UK. It has forced many to make dramatic changes to the way they operate, whether that’s pivoting to sell online or choosing card over cash to sell more safely,” said Felipe Chacon, Economist at Square.
“With the UK’s roadmap for easing lockdown restrictions now underway, businesses nationwide will be looking to adapt once again. This will include a bit of a balancing act between looking at how they keep open new revenue streams discovered during the pandemic whilst also meeting potential customer expectations around a renewed interest in paying for goods or services with cash.
As every sale is going to count once things open up again, the key here will be to offer a broad range of payment options, so that customers are able to pay in a way that is convenient to them.”
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