Has Covid-19 Helped To Change The Way In Which Payments Are Made?

8th September 2020

2020 has proven a year unlike any other in recent times, with the COVID-19 pandemic creating many challenges and difficulties for all industries.

2020 has proven a year unlike any other in recent times, with the COVID-19 pandemic creating many challenges and difficulties for all industries.

The pandemic has caused potentially lasting changes. With government advice of trying to keep contact with objects and surfaces outside of our homes to a bare minimum, the importance of cash has declined as it is estimated that cash withdrawals decreased by 60% compared to April 2019 (1). Yet on the flip side, the importance of mobile payment solutions has never been clearer, as card payments increased by around 20% compared to 2019 (2).  

As a result of this shift in mindset towards payments, small, local businesses who thought outside of the box were able to thrive. Personal trainers, so used to taking cash payments from clients, had no alternative but to take payment via debit cards once they had finished their sessions; some businesses selling food and beverage products had to temporarily close their premises due to restrictions but found new ways to locate and sell to new clients whilst on the move through mobile payments with Apple or Google Pay; events companies are investing thousands into drive-in-cinemas and are seeing the rewards as they use mobile payment methods to accept payment for tickets and food and drinks (3). 

But not every business is finding it so easy to adapt. According to official figures, there are nearly 6 million small or medium sized businesses in the UK (4), and research has indicated that just over 2.6 million of them don’t accept card payments (5). Now there are numerous reasons why these businesses don’t currently accept payment via mobile solutions, such as cost, connectivity, access to a provider etc., but if they don’t adapt with the times, then they risk losing out on a large number of customers.

The evidence is there for all to see, and you only need to look at our friends across the pond to see the impact mobile payments can have. In the US, the mobile payment market increased 41% in 2019 to $98.8 billion, which itself has increased drastically from $12.8 billion in 2012 (6). In the UK, there were an estimated 8.5 million people registered to buy goods and services using mobile payment services such as Google Pay, Apple Pay and Samsung Pay in 2018, whilst 69% of all adults in the UK now use contactless payments (7). It really is a method which can no longer be ignored.

Mark Roberts, CEO of 123Send, agrees that the COVID-19 pandemic has impacted the payments industry for the better. Although the last few months have been very difficult for businesses across the UK, the payments industry is showing signs of not only recovery, but also flourishing. He said: "The first three months of lockdown, from March to May, were extremely difficult with very few people spending and very few merchants actually open for business. However, from June onwards when the lockdown restrictions began to ease, we have been seeing really encouraging signs. The total amount of transactions our terminals process is increasing month on month, whilst the number of terminals our sales team are selling has never been higher."

A key driver to this is the increase in the contactless payment limit from £30 to £45, and merchants finally accepting that card payments are the way forward. Mark says that with the increasing popularity of card payments and the health worries now associated with cash, this limit is only likely to increase. "He firmly believes that it won't be long before you see the limit raised to three figures and beyond in the UK, following the likes of Australia and Japan, both of whom have increased limits to around £110 and £145 respectively!”

So if for whatever reason you are currently not accepting payments via mobile solutions, then there is no need to panic. We offer a range of mobile solutions that accept all forms of payment from contactless payments up to £45, to Apple and Google Pay, to payment via QR readers. These methods can often be faster, safer and more secure than cash payments, meaning they’re more convenient for your customers in today’s climate. As for you the merchant, we will guide you through the whole process from initial enquiry to the installation, and with our free no-obligation 123 Health Check we’re able to check that you’re getting  access to the best rates.