The results of this year's annual BRC Payments Survey, published on July 1st, confirm that cash remains the preferred payment method in the majority of transactions. Despite a slight decline, cash continues to account for over 52% of all transactions.
Drawn from the BRC membership, responses to the survey cover around 56% of total UK retail sales (£333 billion) with a combined turnover of £185 billion.
The respondents to the survey incurred collection costs (charges levied by payment providers to process transactions) totalling around £805 million in 2014.
The survey found that while Cash use has continued to decline in value, specifically the number of transactions completed and in the average transaction value, the decline is not as dramatic as the survey has seen in previous years.
- Turnover: The value of cash used by customers to make payment declined 4.48% year-on-year (from 27.64% in 2013 to 26.4% in 2014)
- Transactions: Cash still retains an important role as it now accounts for 52.09% of transactions, down 0.91% year-on-year (2013: 52.57%)
- Average Transaction Value: During 2014 the ATV for cash declined by 9.33% and the decline over the last five years is 33.62% (from £12.93 in 2010 to £8.59 in 2014)
Additionally while cash accounts for 52.09% of transactions it only accounts for 8.6% of costs. The average cost to handle a transaction was 1.2 pence which represents a 29% reduction over the past 5 years.
Debit cards account 31.74% of transactions and account for 40.72% of costs with an average handling cost of 9.46 pence.
Credit and charge cards account for only 9.9% of transactions, yet account for a absolutely staggering 45.45% of costs – an average transaction handling cost of 33.85 pence.
BRC Director General, Helen Dickinson, said: "Cash remains the cheapest method of payment for retailers to process and, for the moment, it remains the most frequently used method of payment too.”
“We are entering an exciting time for retail as technology continues to have a major impact on everything we do – this is just as true for methods of payment as it is for how products are sold.”
“Meeting new demands from consumers, be it how and where they want to shop or how they wish to pay, retailers will need to innovate in order to continue to meet customer demand. Unnecessary financial burdens will only make this work harder. In order to remain a world leader in retail innovation, we all need to work together to make sure that these burdens are removed."