Debit and credit card usage has gained in its popularity over the last five years, so much so that the use of cash has dropped further into 2014. Debit and credit card usage has increased by 11% and e-commerce sales and credit cards are behind the 14% fall in cash sales.
The value of transactions saw cards accounting for 50% of transactions in 2013 / 2014.
The average transaction value of sales made with cards has reduced proving that small items via contactless card sales had increased by the consumer.
“Customers are taking advantage of new ways to shop and pay. The availability of contactless cards, handy express stores and self-service tills as well as online sales has increased the use of debit cards for smaller payments in place of cash Cash use down 14% in the last five years is a milestone in the development of our digital economy”. Helen Dickinson, BRCs Director
Retailers do make a fair contribution to the costs of processing the sales via card terminals. Not only is this a good thing for the circular economy but it has opened up channels of credit lines to retailers which were not there previously. Take for example a business loan advance, whereby cash loans are offered to retailers who use card terminals. The retail / business owner receives an unsecured cash loan which is repaid based at an agreed comfortable percentage of the business’s future credit/debit card sales until the full payback amount is reached. It is linked to the cashflow of the business. When the business has a quiet month then only loan repayments are made to the equivalent of the percentage of those sales. If the business has a better month the loan is repaid quicker, thus having no APR.