Across the pond, as in the U.S., consumers and businesses are following the COVID-19 influenced trend of digital payments. According to Square’s findings in the U.K., not only has e-commerce and mobile use risen rapidly, but in-store cashless transactions have spiked. In recent years, many payments provides like Square prepared for digital and contactless transactions. Now they are well positioned to handle the accelerated adoption of cashless payments, especially contactless.
The following excerpt from a Finextra article reports more on the topic:
A new report from payments company Square reveals a shift in business and consumer behaviour towards digital payments and a decline away from cash, greatly accelerated by safety measures put in place to cope with COVID-19. Fewer than one in four payments are being made in cash – around half of pre-Covid levels – as businesses and consumers alike look for contact-free ways to pay.
The report also identified that in parallel with this trend of businesses moving away from accepting cash, consumers and businesses are increasingly using e-commerce and mobile payments. The percentage of remote payments taken by businesses using Square increased from 2% in January to 33% in April at the height of the pandemic. As businesses reopen, they continue to process an increased portion of payments over the phone or online without the need for physical contact, albeit not at the same levels seen at the peak of lockdown.
The new report has taken data from thousands of transactions across hundreds of small and medium sized businesses across the UK that used Square’s Point of Sale and payments technology, between January to July 2020. Square found that 31% of businesses made the move to being cashless by mid-July from just 8% at the start of 2020. This equates to an increase of 288%, a trend which shows little sign of abating.
Felipe Chacon, Economist at Square, said: “Covid has changed the way we pay. Existing trends towards digital and cashless payments and away from cash that have been underway for years have been greatly accelerated as a result of the pandemic. Business owners have had to move fast, quickly adapting to new ways of getting paid. They’ve had to balance keeping themselves and customers safe and feel safe, alongside making every sale they can.”
Overview by Raymond Pucci, Director, Merchant Services at Mercator Advisory Group