Card processing for independents

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Handepay on growth and future technology

Mark Latham is the Product and Innovation Director of Handepay he explains what the opportunity is for businesses to grow.

The British public are always eager to embrace new technology and that’s why we’re at the forefront of countries racing towards a cashless society.

More than half of people in the UK expect to see the demise of notes and coins by 2030, according to a recent poll by website No cash will be accepted on London buses from the middle of this year and clothing chain Urban Outfitters have announced they are getting rid of cash tills this year.

The reason for this is that we’re carrying less cash than ever. Physical currency accounted for 71 per cent of all payments in 2003, but by 2012 this had dropped to just 54 per cent according to The UK Payments Council. Now in 2014, that figure is sure to be much lower – the tipping point has been crossed in the balance between cards and cash.

The good news for retailers is that this trend only points in one direction – more sales. All evidence says consumers spend more when they are not using notes and coins.

A report for the American Psychological Association found that, when paying with cash, “there is a tight coupling of the consumption and the payment, thereby accentuating the pain of paying. In the case of credit card purchases, actual parting of the money occurs after the purchase decision, thereby dulling the pain of paying.”

The research also shows that our brains remember cash spending, but we are less able to recall spending on cards. Ultimately, cash encourages self-control while other forms of payment encourage spending.

So whether you are a start-up business, an established independent with one or more outlets, or a larger chain, adopting the latest technology will let consumers pay the way they want to and keep them coming back.

Contactless payment is booming at the moment as the next step in payment technology after chip and PIN.

It takes less than a second to process a transaction, making it perfect for fast-paced lives where we’re always on the go. In my experience, business owners love it because it speeds up transaction times, cuts down on queues and reduces sales lost with people deciding they’re too busy to wait.

Major high street names such as Marks & Spencer, Co-operative Bank, Waitrose, Post Office, Boots, Costa, Greggs, McDonalds, Wilkinsons and WH Smith have all adopted the technology. There are 36.3million contactless cards in circulation in the UK and an estimated 125 transactions a minute on VISA cards alone in Britain. Activity is growing at an average rate of 22 per cent every quarter.

Businesses won’t be exposed to any greater risk of fraud as contactless cards use the same high level technology that’s behind chip and PIN. It’s also no more expensive for business owners as processing the payments is cheaper on a debit card and the same rate on a credit card as chip and PIN transactions.

In addition, businesses can save money in cash handling, gain more consumer data and provide a more efficient service. There’s even more time for interaction with consumers as the payment is processed so quickly.

Of course, technology is constantly updating. Contactless-enabled smartphones, wristbands and watches supporting e-wallets are all emerging or in development as the public’s preferred methods of payment all become more dependent on technology.

So as we hurtle towards a cashless society, it’s more vital than ever that all shapes and sizes of business get smart and keep pace with consumers.