Card payments by postcode

 

Data suggests it’s Central London that’s seen the most significant drop off in business transactions since lockdown restrictions eased. While the City itself is a veritable hub for wealth, the area relies heavily on office workers and has very few residents.

Therefore, everyone from pubs through to restaurants is bearing the brunt of reduced footfall. Likewise, Westminster still has a long way to go until it reverses a 14 percent deficit (on average) in business transactions; however, the return of retail, tourism, and hospitality has helped in recent months.

North of the border, there’s also been a significant reduction in transactions. Highstreets in Perth, Inverness, Kilmarnock, Galashiels, and Kirkcaldy failed to recover due to local lockdowns during the first two quarters. The central belt regions, in particular, facing tighter restrictions. This data largely mirrors the Scottish government’s research on the services sector.

But it’s not all doom and gloom. Just a half an hour tube ride from the City of Westminster, businesses in Bromley have seen a 20 percent increase (on average) in highstreet transactions during April and May this year. One reason is the transfer of trade from major city centres, including commuters travelling through wealthy belt areas, such as rural Kent. Moreover, while Blackpool in the North West only saw a 4 percent increase at the start of lockdown easing, this shot up to 18 percent a month later — bolstered most likely by tourism.

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Sectors struggling and thriving

 

The insurance and fuel sectors lead the way for the largest increase in business card transactions since 2019. The latter saw a 26.16 percent uplift in April 2021— shortly after schools reopened throughout the UK—followed by a further increase to 39.77 percent in May. During March, many shops, hospitality, and entertainment venues were still closed, forcing consumers to drive further afield to enjoy outside leisure facilities. Other fruitful sectors include the recruitment industry, which saw a 32 percent rise in activity across April and May, likely due to increased labour shortages.

However, comparison data makes for grim reading in the travel, media, and entertainment sectors. The former saw a 23.93 percent decline in card transactions across April and May, while nightclubs unsurprisingly accrued 30.91 percent fewer payments.

Other poor performing businesses were food, drink, dairy, and convenience stores. All were down by nearly 5 percent on the 17th of May, even though many sold essential items throughout lockdown periods. We can draw from this data that smaller retailers lost out to supermarkets that increased delivery services over the last year. Unsurprisingly, restaurants and hotels also saw far fewer transactions when compared to 2019, while hair and beauty businesses stuttered until mid-May.

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High street transactions by month

 

‘Stay at home’ rules on travel were lifted in England on the 28th of March, and outdoor gatherings in gardens became legal once again. The impact on businesses in the South East and Greater London was positive, with companies in Slough reporting only a 5 percent decline in card payments compared to 2019. Bromley, Watford, Guildford, and Taunton in the South West all catalogued a 5-10 percent deficit, a minor loss when compared to companies operating in Scotland.

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12th April easing of lockdown restrictions

 

Businesses north of the border took the biggest hit on card transactions during April due to nationwide restrictions remaining in place until the 26th. Therefore, with retail premises, libraries, galleries and tourist accommodation all out of action, the most populated areas in Scotland’s central belt performed worse than any other UK region. For instance, Galashiels had around 35 percent fewer card transactions than in 2019, while Inverness, Paisley, and Kilmarnock shared similar losses. In addition, severe local lockdowns during Q1 and Q2 also meant that Glasgow posted a 20 percent loss in terminal use.

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17th May easing of lockdown restrictions

 

As previously mentioned, Central London saw the most substantial drop in terminal transactions during May (around a 25 percent deficit) compared to 2019. But another poor performer was Bath, a city that would usually welcome one million overnight tourists and 3.8 million day visitors. A possible explanation for the region’s 17.71 percent decrease in highstreet trade is that the UK weather was still wet and cold during the week commencing 17th of May. Likewise, the university city’s world-famous spas and white-washed buildings rely heavily on tourism. The Berkshire town of Slough also witnessed 15.74% fewer card transactions than in 2019, undoubtedly due to the heavy economic reliance on office workers positioned close to London.

 

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High street transactions by region

 

On the 17th of May, indoor venues and hospitality businesses opened in England, along with limited capacity sporting events. These additional freedoms had a dramatic economic effect on Yorkshire and the North West, particularly the former, which recorded nearly 5 percent more merchant card transactions than in May 2019. Blackpool saw the most significant rise in highstreet footfall, earning around 18 percent more terminal payments than during pre-pandemic trading.

We can see that Wales followed suit once the country moved to Alert Level 2 and entertainment venues, such as museums, were reopened. The country’s most central town, Llandrindod Wells, was the top performer in our studies, showing a 15.56 percent uplift in merchant transactions when compared to 2019. Other prosperous regions include Darlington, Telford, Cambridge, and Bournemouth.

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How does the Capital compare?

 

Looking specifically at merchant transactions in Greater London, there’s a sizeable disparity between towns situated in and out of the City. For instance, Bromley saw nearly a 20 percent rise in card payments compared to 2019, as did Ilford (16.59%) and Kingston Upon Thames (15.48%). In contrast, Central London suffered the most significant decline in transactions, recording a 24.32% deficit from pre-pandemic trading.

These startling figures illustrate why the government tried to encourage people to go back to offices in autumn 2020, as hospitality and retail commerce dried up due to fewer functioning workspaces. However, the good news is that when we remove central postcodes from our data, transactions look a lot healthier in Greater London, with areas like Enfield, Dartford, and Harrow all recording positive yields.

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How independent businesses have fared

 

Independent businesses posting reduced merchant transactions in May mirror many of the national industries previously touched upon. For instance, independent travel companies saw around a 10 percent decline in card transactions, saved further only for an upswing in staycation bookings. Similarly, charities and non-profit organisations experienced close to an 11 percent downturn, as was predicted in our Small Business Challenges report.

The education sector, for obvious reasons, lost nearly a quarter (23.45%) of all card transactions from highs of 56.64% in 2019. Likewise, museums suffered a 16 percent downturn due to neglect during lockdowns. On a more positive note, independent bookstores received only 4.5 percent fewer card payments than in 2019, suggesting that some consumers favour the highstreet over online retailers.

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