The average cost of cash handling for UK SMBs has reached more than £17.8 billion a year, or £3,638.57 per retailer, according to new research by payment service provider Sage Pay.
The survey also found that businesses are not investing enough in new payment technologies, despite consumer demand.
36% of consumers say they are more likely to shop at places that offer a range of payment methods or innovative payment types.
And more than half of businesses agree that offering a range of payment options drives loyalty.
However, despite this, 80% of businesses polled say they will only embrace new payment methods, such as contactless payments, payment apps or bitcoin, if customers request it.
The Payments Landscape 2014, a report released today by Sage Pay, finds that UK SMBs need to speed up their adoption of new payment methods or risk losing out on new business.
36% of the businesses surveyed say they will be looking to adopt contactless payment within the next five years.
Sage Pay surveyed 1,124 UK business decision-makers and 1042 consumers in the study and has identified five areas that should be a key focus for UK SMBs in 2014.
Moving away from cash and embracing new payment technologies, going omni-channel, exploring overseas trading and addressing the balance of losing money to fraud versus losing genuine shoppers with stringent fraud screening tools are all areas that, tackled correctly, can make the difference between high and low growth for businesses.
63% of businesses surveyed have yet to integrate their online and offline channels via an omni-channel solution, despite more than half of consumers saying they prefer to use more than one channel when making a purchase.
What’s more, this year saw 40% of businesses lose money as a result of fraud, yet 39% of businesses surveyed don’t spend anything on fraud prevention.
Simon Black, CEO at Sage Pay says: “UK SMBs are a driving force in the UK economy, but if they fail to innovate, they are in danger of being left behind.”
“Reducing friction should be the focus for every business. Whether that’s looking at moving away from cash towards newer payment types, using ‘single-click’ checkout or adopting an omni-channel approach, this report looks at payments in the context of the consumers and businesses that use them.”
Cost of cash to UK businesses more than £17.8 billion a year
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