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Pressure on ATMs

Consumers switch to plastic as card payments overtake cash

contactless

Card payments are rising

Consumer spending by card overtook cash last year, putting more pressure on the availability of hole-in-the-wall dispensers.

Cash use has dropped from over half of all transactions in 2013 to under 40% in 2018 and accounted for just over £1 in every £5 spent with UK shops. Cash payments dropped to third place behind debit and credit card spending

Nonetheless, the British Retail Consortium says cash remains an important part of retail, particularly for many vulnerable people, and the BRC is working to ensure the long-term viability of ATMs and reduce barriers that prevent many businesses from offering cashback to customers.

Consumer group Which? this week said that hundreds of free-to-use ATMs are closing every month across the UK. 

BRC figures show total UK retail sales rose by 4.1% to £381 billion and here were 20.1bn transactions in a single year (more than 55 million transaction a day) up from 19.8bn in 2017.

But each transaction cost retailers an average of 5.85p, up 17% from 4.98p. Furthermore, Brexit will result in British retailers paying more to accept foreign issued cards and will increase the costs for business in the future.

Andrew Cregan, BRC policy adviser, said: With card payments accounting for almost 80% of retail sales, it is vital that the Government takes action to tackle the soaring costs that card companies charge retailers. Without action we will see businesses put under further pressure and it will be consumers who are forced to pay the price.”

David Lonsdale, director of the Scottish Retail Consortium, added: “Retailers have invested significantly to make shopping easier and more convenient for Scottish consumers using card payments.

“This has led to almost four fifths of retail sales by value now being by card, a significant milestone in the development of our digital economy. The availability of contactless card machines, self-service tills as well as online retailing has increased the use of cards in place of cash.

“But retailers continue to shoulder significant hidden transaction costs. Government and regulators need to do more to tackle this.”



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