SMEs are losing out to the tune of billions of pounds by not offering non-cash payment options. Businesses still stuck on the cash system are at threat of a range of risks, according to Sage’s research.
Almost a quarter (24%) of business owners report having been the target of cash theft by a member of staff, while 34% admit to losing cash due to human error. Finally, more than half say they spend up to an hour or more counting and transporting cash to the bank each week.
The cumulative costs of all this inefficiency, Sage estimates, amounts to around £9.4bn in lost revenues and unnecessary costs. The figures, that are taken from Sage’s sixth annual Payments Landscape report, show that small businesses must respond to changes in consumer demand.
Indeed, the research shows that a majority of consumers says it’s important for businesses to offer customers a diverse range of payment methods, while 58% claim they would be more likely to shop somewhere that offered them multiple ways to pay.
Seamus Smith, CEO of Sage Pay, thinks that cash is bad for business, is costly and inconvenient, and that appetite is growing for more innovative and flexible payment methods.
‘Payments should be seamless, frictionless’
He says the research shows that cash use in in decline and this is part of a wider trend, highlighted by the increase in UK cashpoints but the decrease in cash withdrawals.
Smith adds: ‘Link is reviewing the need for hole-in-the-wall machines as consumers opt for more innovative types of payments. At the same time, Mastercard has recently launched ‘selfie pay’ and Alibaba is soon to introduce a virtual reality payment system.’
‘Payments should be seamless, frictionless – and more often than not, cashless. Innovation in the sector has never been greater but small and medium businesses must keep pace with change. They are the lifeblood of the UK economy, and their success is critical to our national growth.’