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The small business cost of not accepting card payments

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Image: Credit cards via Shutterstock

Many customers choose to pay by credit or debit card and as a small business owner you could be missing out if you choose not to accept this method of payment. With customer satisfaction being a big part of customer retention, some may feel put off if they need to withdraw cash in order to be able to purchase an item from your store.

So, why is the facility to accept debit and credit cards so important?

Barclays have revealed that only 42% of small to medium-sized businesses currently offer customers the option of paying by card. With three quarters of all retail transactions in the UK carried out using cards, it is clear that large numbers SMEs (small and medium-sized enterprises) are missing out on a trick.

Indeed, the research reveals that on average, each SME not offering card payment options is literally losing out on hundreds of pounds a week. This amounts to £7.5 billion in total across the UK.

What is surprising is the fact that a quarter of those small businesses not accepting card payments are aware of the fact that they are losing business as a result.

So, why are they not accepting card payments?

Historically, the costs associated with renting card terminals and processing payments, in addition to the cost of a dedicated phone line, have proven too much of a financial burden to SMEs, and it made more sense to accept only cash and cheques, as described in this article from GoCompare.

Another reason is fear of credit card fraud, with small businesses being particularly vulnerable to card theft from computer hackers. This problem is estimated to cost UK businesses millions of pounds.

There is good news though!

Technology improvements and the mobile revolution means that there are now a number of more accessible solutions to help small businesses save money by accepting card payments, and to do so securely. Now even the smallest startup or seasonal business can access the technology to hold on to sales that they may have lost a short time ago.

It’s an opportunity financial services providers have become attuned to, with several new products entering the marketplace. Barclaycard Anywhere, for example, is billed as a secure cost-effective mobile point of sale solution, which attaches to a smartphone or tablet. It uses a purpose-built app to accept card payments from any UK location securely, using chip and PIN technology.

The cost of not accepting card payments is estimated to average £182 extra per week for small businesses, that’s £10,884 over a year. If you are one of the 60% of SME’s who are losing out in this way, it may be time to take another look at the payment technology. With a smartphone in your pocket, you could be closer to accepting card payments than you realise.

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