One in six British shoppers (17%) is now a “card-only” consumer who never uses cash to pay for their shopping in an average day, and a further two in five people (38%) describe themselves as “card-first” shoppers, who would typically try to pay with a card first before they have to pay with cash. Those are some of the findings from a new study by Square, which looked into the changing attitudes towards paying for goods and services in modern Britain.*
The findings follow data from the British Retail Consortium released in July which showed that, for the first time, more than half of all purchases in the UK were by card, not cash.** But as consumers’ behaviour changes, not all businesses are keeping up with the times, especially among Britain’s small firms.
Giles Chater is a 31-year-old Operations Director from Hertfordshire. He drastically reduced his cash-carrying habits about two years ago, and now carries no more than £5 at any time. He said: “I’ve been fully cashless for the past year - I can’t remember the last time I consciously carried cash. I find trips to the cashpoint inconvenient and time consuming.
“I suppose I’ve subconsciously stopped shopping with businesses that don’t take card. I tend to buy my lunch from the supermarket rather than an independent sandwich shop, just so I can pay with card.”
Chater also points to the social stigma of being unable to pay at a shop that won’t accept card payments: “I hate that awkward moment when you want to buy something and the retailer doesn’t take cards - it’s embarrassing for everyone. I’d rather just shop somewhere where I knew I could pay.”
Square’s research (1) found that up to three million of Britain’s small businesses still do not accept cards. Yet six in ten of us (60%) would shop more at small businesses in our local area if we could pay by card. These local businesses are missing out on potentially millions of pounds in lost sales - more than one in four shoppers (27%) hasn’t bought something because they couldn’t pay with a card. Yet 44% of small business owners think they don’t miss out on sales if they don’t accept cards.
Glenn Hunter runs Hunter Home Ventilation in Lisburn, Northern Ireland. He has been running his business since 2007 and has seen a shift in behaviour from customers paying with cash and cheque, to now wanting to wanting to pay with card. That prompted him to sign up for Square. He said: “I’m a one man band and need to make sure that I get paid for the work I do, promptly, and in full.
“Most of my transactions are over £100 - in the past people may have had that amount of cash in the house, but these days that’s just not the case. It got to the stage where I was having to chase people up for payments after I’d finished a job, and it affected my cash flow.
“Using Square to take card payments has really helped me out - now I can take payment straightaway when I finish a job, and I don’t have to spend my evenings chasing people up, which - speaking frankly - is embarrassing for everyone and a bad use of my time.”
While cash isn’t completely dead, it’s definitely taking a less central role in our lives. According to Square’s research: nearly one in three of us (30%) haven’t taken out cash from an ATM or bank in the last week. The average Brit has just £32.54 in cash in their purse or wallet right now – given that the average transaction in the UK is £18.42, this isn’t even enough to cover two typical purchases.***
Consumer attitudes have changed to such an extent that people avoid shopping with businesses that don’t accept cards. One in five of us (19%) say we’re less likely to use a business where we can’t pay by card, while more than one in four of us (26%) feel that businesses that don’t take cards are old-fashioned.
Commenting on the research findings, Sarah Harvey, UK Lead for Square, said: “British business is fiercely competitive, and nowhere is that truer than on the High Street. Small businesses are competing with larger competitors who have greater resources, so they need to make use of every advantage they can get. That means making it as easy as possible for their customers to buy from them, including accepting card payments alongside more traditional methods like cash.
“Technologies like Square mean that there are fewer barriers between businesses and their customers, so they can ensure they always make a sale.”
Notes to editors
* Square commissioned a nationally representative survey of 2,044 consumers and 1,202 owners of small businesses around the UK, conducted by Censuswide between 15 - 24 August 2017.
** British Retail Consortium data
*** British Retail Consortium data