The payment landscape in the UK and throughout the world has changed dramatically as a result of COVID sweeping the globe.
Here at takepayments, we’ve supported our customers and small businesses through this unprecedented time as best we can, so here we’ll break down the very latest information on how the world of payments looks today.
We’ll also present a snapshot of how that compares to some of the world’s leading economies, and finish with an overview of what small businesses can do to keep up and come out of the other side on top.
The latest research by Accenture shows that cash usage is declining rapidly as a result of the pandemic, down 50% in March 2020, driven by three key factors:
Research shows cheques were an alternative adopted early in the lockdown process, but the experts have argued they aren’t a viable, long-term solution.
Instead, contactless card and digital wallets i.e. Apple and Android Pay, have been suggested as the ‘natural successor’ to cash.
According to those in the know, COVID-19 will contribute substantially to the continued and rapid decrease of cash usage in the UK. Even before it hit our shores the prevalence of cash was on a steep downwards trend.
Instead, the newer kids on the block will play a significant role in replacing cash in the UK for good.
Tokenized payment instruments is just a very technical term for digital wallets, and thanks to COVID-19 these are more popular than ever in the UK.
The likes of Apple Pay, Android Pay, and other mobile payments offer a streamlined and simple consumer experience for:
They remove the need for PIN details to be entered and more often than not carry no spending caps. For these reasons, financial analysts have predicted that in a post-COVID world digital payments will be widely adopted.
Now let’s take a look at how payments are changing in four of the world’s leading economies.
In the USA the payment landscape is less clear cut - before the pandemic cash remained one of the most popular methods of payment, accounting for 26% of all transactions in 2019.
While there are similar concerns by many over the risk of transmission when it comes to handling dollar bills, the American approach to payments hasn’t wavered as much as the UK’s and there has been no national guidance to suggest avoiding it.
That being said, research is suggesting the ‘mighty dollar’ has lost some of its clout thanks to COVID as many businesses are encouraging contactless payments where possible.
One of the major differences between the UK and USA, and likely a driving factor in their alternate approach, is the population’s access to banking - particularly those from minority backgrounds - with an estimated 25% of the population ‘unbanked’, making modern payment technologies inaccessible.
Details on the impact of COVID on China’s payments are a little more scarce, but at the height of the pandemic banks in the country did begin to disinfect and quarantine banknotes in an attempt to slow the spread of the virus.
China is already a few steps ahead of some parts of the world when it comes to digital payments and they’re currently in the process of developing a nationwide digital currency, backed by the country’s leading bank. Details of its release are vague, but it’s expected to become widespread in the not too distant future.
The impact on payments in Australia is much the same as the UK, with cash payments declining and contactless transactions increasingly rapidly - predicted to be more popular than ever following the pandemic.
Germany has a very strong affiliation with cash, and in 2017, cash was the payment method of choice for 88% of Germans. Enter COVID and things have made somewhat of a u-turn with cash payments actively discouraged for the first time ever.
By late April 2020, 43% of Germans surveyed admitted they’d changed their payment habits and 68% said they were now more likely to pay by card. Adding to that, over half stated they’d ‘significantly reduced’ their cash usage.
For small businesses working hard to recover from the devastating effects of COVID-19 the consensus from financial analysts is they need to start accepting contactless and digital payments to maintain a competitive advantage both now and in the future.
The good news is it’s easier than ever before to make the switch and the latest payment systems on the market are super simple to set up and start using.
Here at takepayments we offer three market-leading card machines, as well as innovative mobile invoicing solutions like beepaid, and three online payment solutions. Let’s take a quick look at each:
All three of our top-notch terminals are set up and ready to accept the latest payment types including contactless and digital payments, Apple and Android Pay.
Our brand-spanking-new beepaid app makes accepting safer payments on the go a piece of cake, all you need is your mobile phone.
It’s totally contactless, no matter the size of the transaction, and installation and set up couldn’t be easier.
If you’re ready to update your payment systems to accommodate the impact COVID-19 has had on payments, you’re in the right place. We:
So what are you waiting for? Get in touch to discuss your options and get the ball rolling today.