close

UK retailers amass £1.1bn bill to accept customer payments

money-card-business-credit-card-retail-shop-pay-50987 (1) CROP

The BRC and other trade bodies are calling for action to tackle excessive card costs as a Government call for evidence on payments closes today.

It comes as the BRC Payments Survey shows a continued move from cash to cards in retail.

It shows card use continued to rise steadily from 54% of transactions in 2016 to 61% in 2019.

Story continues below
Advertisement

This trend has accelerated under coronavirus, which lead to more customers shopping online or paying by card in store.

At the same time, the cost to retailers of accepting payments reached £1.1bn in 2019, of which £950m was from card payments.

While card payments account for 4 in every 5 pounds spent in retail, they also incur the largest charges with shops charged an average of 18.4p per credit card transaction (up 15% from 2016), and 5.9p for every debit card transaction (up 6% from 2016).

Furthermore, businesses have received notices in the past year of new fees that will now be charged to accept payments online.

At a time when retailers are facing increasing costs due to coronavirus and Brexit, the increasing scheme fees place further pressures on retailers.

Ultimately these costs, equivalent to £40 per household, will be reflected in consumer prices.

The calls come amidst a series of reviews underway by government and the UK’s Payment System Regulator, with a Treasury consultation on the payments landscape which has now closed.

Organisations are also calling for further measures to protect consumers’ access to cash, which remains an important method of payment, particularly for many vulnerable people.

Andrew Cregan, head of finance policy at the BRC, said: “With card payments accounting for almost 80% of retail sales, it is vital that the Government takes action to tackle excessive card costs. Without action we will see businesses put under further pressure and it will be consumers who are forced to pay the price.”

Tags : businesscardcashretail
Alex Douglas

The author Alex Douglas

Leave a Response