The importance of chip and pin for small businesses

As time goes by, what was once an exclusive thing becomes common to most. Chip and PIN is an example of this, once being only for the upper corporate world and now being an asset to any small business across the country. This major change has come from the technology being streamlined into a smaller and cheaper package whilst still remaining just as efficient- and here’s why you should look into it for your business:


Why should you buy one?

Chip and PIN has been a game changer for many small businesses, and such should be expected. In many cases, a one-off payment is all that’s needed for the device as a whole, and then only a regular transaction fee of around 2% of profits. It is also a near instant installation, so you can start using it straight away.


In this age, almost every business is expected by their customers to take card payments. Some reasons for this would include the convenience of not having to look for change, and the convenience of not having to take money out before shopping.


The whole system is also encrypted, so you don’t need to worry about anyone stealing money from a customer, or your store.


On the subject of cash, installing the Chip and PIN system isn’t that costly. With new products constantly being released and improved, the cost of the devices you’ll need has been lowered significantly and allowed business both big and small to have equal opportunity when it comes to their in-store equipment.

With card readers now being both cheap and widely available, getting one for your business is a no-brainer to appear both professional and modern.

There’s a great probability your competitors are already using card readers to provide the best customer service they can. Having this payment method stops you from being seen as outdated or inconvenient, which are two labels a business does not want to have.


On top of that, you don’t want to deny a customer a product due to your business not accepting certain payment methods. More and more businesses are now accepting the Chip and PIN method as well, making it a surprise when a business still only takes cash.

Lagging behind when it comes to card readers will definitely damage your brand and its potential profits. Changing all that by installing a card reader, however, will definitely boost your revenue and customer base.


How it may differ from business to business

Mobile Chip and PIN

Does your business require workers travelling to the customer, such as with delivery services? Normally, that’d be something where cash would be a necessity but with mobile Chip and PIN machines, this is no longer a problem. Taking a payment at a customer’s home or on the road is now as easy as doing so in store. The mobile reader connects either to a mobile network or through your phone, to offer both ease of transaction and better service to your customers or clients.


In the case of restaurant payments, they use a base unit with an online connection that several card readers in the vicinity connect to. This allows you to move directly to your customer’s seat for the payment. or anywhere else in the building, making the system perfect for restaurants.

This isn’t just something for restaurants though, with this convenient method of payment excelling in any field where there is a server moving around to customers.


Card machines are incredibly important, as they open up another avenue for sales, gives another layer to your customer service, and stops your store keeping an unhealthy amount of cash on premises.

With the customers expecting both cash and cards to be payment options, it’s a good option for both you and your customers.

It’s no secret that stores with card readers have more sales, so what are you waiting for?


Looking to get a card reader?

Here at CheaperPay, we have 3 card reader options for businesses. We are able to provide low cost terminals designed specifically for the small business market. This is why we completely avoid long-term contracts, and don’t partake in large fixed costs that would affect your cashflow. We offer all three of the terminals mentioned in this post, and can even offer further advice on request! Visit http://cheaperpay.me/request-a-quote/ to get a FREE quote.

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How to accept card payments – The Beginners Guide

We live in the digital age where computers and electronic data are paramount to almost everything; even money.
As one going into a new business as either an employee or owner, you must be aware of how credit card payments will be a key factor to your business flourishing in success.

We will walk you through a concise plan of how one unfamiliar with bringing credit card systems into a business, as you well may be, can catch on to the basics and see several new opportunity’s in your company’s growth.

Benefits of Card Payments

The first major benefit of card payments is their simplicity. Most people have become attuned to paying via card nowadays, so being able to accept such payments will make business transactions occur at a far quicker and more efficient rate, as customers will be able to pay instantly rather than taking time for a cheque payment to be cleared.

” I’m hoping to be alive to see the elimination of money. ” – Tim Cooke, CEO Apple
Source: Mashable.com

This is more important when you take into account how the use of cash has taken a decline with the ease of contactless technology for small purchases. This has lead to the prediction
that most people will lean more towards card based payments over time.

Not holding as much physical cash will mean you have far less need to spend money on security for a safe and will mean you needn’t travel for a deposit as often.
Moreover, you won’t need to rely on alternate financing such as loans or overdrafts often, improving your cash flow.

Accepting card payments doesn’t just benefit yourself, but the customer.
Imagine yourself as the customer, needing to head immediately to the cash machine only to waste time unnecessarily, having problems withdrawing the cash or even getting so annoyed with the situation you decide not even to bother investing in this business.

Being able to facilitate instant transactions will convince the customer to see a variety in convenient payment options and be more likely to return.

Time can also be saved in that your customer and yourself won’t need to count the physical money you hold when making a payment. A quick insert of a card and short PIN code entry, or even a swipe of a mobile phone from something like Apple Pay, will have the trade take a fraction of the time fumbling with physical cash would…

Knowing exactly how much money will be transferred and gained during the process means you can plan ahead for future payments, profits and savings. Card machines also make your customers on average more likely to become victim to impulse buying and means less physical cash and cheques need be dealt with, which means fewer bank fees.

Genuine data proves the benefit of cards. According to the Global payments report preview produced by Wordplay in 2015, Credit Cards were predicted to become the second most popular payment option by 2019 and online payments becoming the most popular; something still requiring a credit card.

No matter how you see it, the future where cards take precedent is incoming and any aspiring businessman best be prepared.

Why do we need a Payment Gateway and Merchant Account?

Once knowing why card payments are important, you’ll obviously want to know the “how.”
That would require a few small steps before any payments can be made by gaining two essentials.

What is a Merchant Account?

Firstly, a Merchant Account is required. These are a type of bank account that holds a customer’s account before entering the bank account of a business. This makes it a secure option for both the customer and you, the business owner, authorising the payment for a successful transaction. This payment should enter your business bank account within 2-3 days.

Before rushing towards procuring a merchant account, however, you need to be aware of the requirements:

  • You must be at least 18 years of age.
  • Unless a sole trader, you must have a business account.
  • Be within one of the countries in which the merchant account system is supported (Most
    countries in Europe support it)
  • Must not have a business on the Prohibited Business list (Adoption Agencies, Legal Highs,
    Sex work, etc.)

For a full list of supported countries and Prohibited Businesses, see here:

How does a Payment Gateway work?

Secondly, you will need a Payment Gateway.

These act as a connective between your business’ website and the banks, being a swift and seamless process where your customer need not interact with the intermediary step of the gateway.
The gateway purely acts as a platform on which a customer’s credit card and details are submitted and securely sent to relevant financial networks affiliated with the bank and to the merchant account, all it’s sensitive data being encrypted to avoid any third party hacking the data in an act of theft.

The method of card payment can differ depending on how your business operates. The convenient countertop card machines will make retailers and any other in-store establishments far more efficient for their easy usability and close proximity to the cashier’s station.

If, on the other hand, your line of work makes bringing the payment option to the customer rather than vice-versa then portable card machines are recommended far more; an essential for any sort of eating establishment (restaurant, cafe, pub, etc.). Bluetooth technology allows the payment to be processed anywhere within the business’ premises.

Similarly, mobile card machines allow for a greater range in payment; anywhere within the UK where network coverage is available being capable of having a payment transferred.
GPRS technology makes it convenient and essential for businesses that rely more on long range work such as online payment.

When it comes down to actual payment, you must also have a business bank account to transfer the money into through your merchant account, which will take roughly two working days. Such accounts will require a Tax ID Number and a social security number regardless of you having your merchant account yet, though whether or not you need more will vary depending on your specific bank.

Card Processing Fees and Rates

If you have little experience with making card machines part of your business, you may be surprised to find there is a fair amount of cost in bringing it in, though how much depends on
several factors.

Along with deciding which of the three card machines you wish to utilise, you need to consider what type of business you are working on and your turnovers.

To plan your utilisation of card machines, here are a few questions to consider:

1. Transactions – How many do you make face-to-face and/or online/long range transactions
do you make per month? If both, how do the two methods compare?
2. What is the value of each individual card transaction you make per month?
3. What is the total value of payment received from card transactions per month?
4. What types of card make up the majority of transactions (credit, debit, etc.) and what
banks are the most popular?

Once you have come up with an answer to all these questions, you can speak to CheaperPay for advice and calculations of the cost.
As a small example, you may only need the merchant account and gateway solution if your business is exclusively online, whereas having the gateway overshadowed by card terminals.

Obviously, you will want heavy priority on all these options simultaneously if your business is both store and web-based.

Merchant Service Charges

Merchant Service Charges , as you may imagine, refer to charges a merchant account receives based on the transaction rate your payment provider agrees to, based on your answer to the four prior questions. This is set as a percentage of each transaction being taken by your provider as payment and varies depending on whether or not your account is on a credit or debit card.

Authorisation Fees

To authorise each payment, you’ll need to pay Authorisation Fees .
The preset fees from the average provider based on the GBP currency are 0p for contactless transactions, and 2-4p for any card based transaction.

Minimal Billing

If your two fees previously explored fall below the amount agreed upon with your payment provider, you may be charged a Minimum Billing, which is on average £20 per month.

Card Machine Hire or Purchase

You will also need to hire various things such as card machines. Per month, Desktop/Countertop card machines generally cost £15, portable card machines with a fixed base unit cost £20 and Fully mobile card machines with a built in SIM card cost around £25. This isn’t taken into account VAT costs that will be necessary.

If you would rather pay for a machine than constantly pay for hiring, several banks will offer portable card machines for new businesses with prices usually ranging from £50-70.

As one who has aspirations for creating a business or trying to help expand a small business you are part of, this guide should now help you realise the benefits and cost of installing credit card payments as an essential part of your business.

CheaperPay can offer the best advice, setup and prices for the most appropriate card machine and the bills associated with them, you should reap in the many benefits of the time, free space and money that credit card payments provide for your business.

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Shop tills to ring to ‘optimistic’ chime for Visa transactions in new era of ‘sensory branding’

Shoppers already driven to distraction by the incessant dinging, and beeping of self-checkouts could be about to face a new headache.

Payments using Visa will soon be accompanied by a ‘signature sound’, which will chime out each time a card or smartphone is presented, or an in-app purchase made.

Marketing employees at the company have spent a year choosing the perfect noise which, they claim, signals ‘speed and convenience,’ while being ‘energetic and optimistic.’

The insist it is not ‘overly intrusive’, and claim other ‘chimes’ were eliminated for being too ‘angry’ or eliciting ‘visceral reactions.’

The company is also launching a unique vibration which users will feel when paying by smartphone, claiming it is entering a new era of ‘sensory branding.’

The company has made the change because fewer tills carry Visa logos now

The new sound and vibration were picked after spending months carrying out neuro-research to test the physical reactions of volunteers when they were played different sounds. The company claims users were left feeling ‘happy’ and ‘excited’ by the new chime and vibration.

“We wanted to make sure we had the global view, not just four-to-five uninformed people deciding which sound won the popularity contest,” said Visa’s marketing chief, Lynne Biggar.

“You’d be surprised by how excited and how competitive or opinionated we all can be about very short sounds.

“We all are becoming very responsive to the use of sound.”

Companies like Intel are already using sounds as part of their logo. The ‘Intel Inside’ bong is still going strong after 20 years.

The new sound will launch in January ahead of the Olympic Winter Games in Pyeongchang, South Korea, with a new advertising campaign featuring athletes making payments by swiping a credit card, tapping a phone and completing purchases online.

“As new payment experiences continue to take shape in the world, this suite of sensory branding elements will give consumers the assurances we know they want every time they use Visa,” added Miss Biggar.


(The Telegraph, 2017)

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Avoid being hit by the Government’s credit card surcharge ban with Cheaper Pay!

As of January 2018, businesses will be stripped of their ability to add any surcharges to their card transactions.

Airlines, fast-food chains and small businesses will be those who suffer most from the ban, but there are ways in which these companies can make up for this potential loss of capital.

Cheaper Pay’s industry-leading payment solutions come in at a staggering 40% cheaper price than the likes of WorldPay, Barclays and Lloyds – offering terrific value for money, as well as bearing the costs that may be lost in profit once these government changes come in to fruition next year.

Having provided UK businesses with the crème de la crème of payment technology for over a decade, Cheaper Pay are well placed to install the ideal payment system that is perfect for your business’s needs.

For a FREE no-obligation quote, get in touch with one of our specialist advisers today on 03301 242 537.

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Five reasons to offer contactless payments

Here at CheaperPay, we fully believe that contactless payments are the future for all businesses, regardless of size – and here are five reasons why!

1) Simplicity
This one speaks for itself. The simplicity of contactless payments has revolutionised the transactional experience for both customers and businesses.
Transactions can now take place at a fraction of a second, affording to a more positive customer experience – and that can only be a good thing!

2) Time-Efficiency
Time is becoming an increasingly rare commodity in the lives of the full-time worker. We simply don’t have time in our day to queue, key in PIN numbers or wait for the ‘correct change’.
Contactless payments solve all these issues – customers can check out in an instant, saving time for the more important things in life.

3) Security
Contactless payments account for just 0.02% of all card fraud transactions on the planet. Hi-tech anti-fraud technology is utilised by many systems, ensuring safe and secure payment for both customers and businesses.

4) Increased quantity of transactions
Customers who pay with cash have an obvious limit as to how much they can spend in your store.
Offering a contactless payment solution does not only speed up the transaction process, it may prompt customers into spending more on your products – safe in the knowledge that the buying process is quick, simple and secure!

5) Customer Retention
A summary point here, but still relevant! Customers who are regularly receiving quality, efficient service from your business will be far-more inclined to return again and again. This will build up a great rapport with regular customers and greatly enhance the reputation of your business!

So, there you go. Go Contactless today with CheaperPay!

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Reasons why your Business NEEDS to make the switch to contactless payment solutions

More than just a saying or statistic, it has become reality that ‘Businesses that decline card payments are losing out’.

Sorry, we don’t take card payments’ should be a thing of the past as Britain quickly converts to a cashless society, not taking card payments should be something rarely heard of by now. Unfortunately, this is not the case just yet. 75% of all UK retail purchases are made by card; and yet still, more than two thirds of British small to medium sized businesses (SMEs) still don’t accept card payments.

With Cheaper PAY’ment solutions you can:

  • Accept Payments over the phone
  • Accept online Payments
  • Accept smart phone payments
  • Accept Chip ‘n’ Pin payments

How will these benefit your business?

  • Never miss a sale – Customers are able to buy your products anywhere at any time with secure online payments which means more sales for your business.
  • Beat your competitors – Customers are more likely to shop at a store that offers card payments.
  • Happier customers – Card payments are processed in a matter of seconds so customers can quickly continue with their day and you can get on with serving the next customer.
  • Lower bank fees – Handling less cash means fewer trips to the bank and more money back into your business.
  • More security – Extra features protect your business from fraudulent transactions and tell you immediately if a customer’s funds have not yet cleared.

Our low transaction costs are what make Cheaper Pay one of the most affordable merchant service suppliers available. Many card machine companies will charge you for a service that is designed to benefit growing businesses rather than hinder them.

At Cheaper Pay, we believe in supporting and innovating businesses with evolving technology. That is why we offer FREE quotes and a 3 months’ free trial to ensure that the payment solution you have chosen is compatible for your business.

To begin your journey to contactless payment get your free quote HERE.

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Card Payments: The Cost Of Staying Static

More and more businesses are realising the potential of adopting card payments as well as cash transactions. With debit and credit cards being used as a consumer’s preferred payment method these days, it’s no wonder that the credit card industry is booming and contactless payments are taking off as much as they are.

However, as a small business, you may be concerned about the cost of having card payments, rather than the additional profit you’ll receive overall. These fears often lead to cash-only payment transactions for many small businesses, until they can accept card payments.

But when taking a look at the overall statistics of card payments, your business is more likely to succeed in the long term than fail.

The Statistics

Roughly, small businesses and SMEs who do not accept card payments are losing out on £8.8bn profit. £52.6 billion is spent by consumers using card payments in the UK with 70% of consumers prefer card to cash. Meanwhile, 32% of UK adults would not purchase from a store that did not accept card payments.

With these alarming statistics from the general UK public, it seems likely that a small business would struggle in it’s first year by not allowing card payments, unless the product was unique enough to suggest otherwise.

The Conclusion

Long term numbers and statistics are more reliable than short-term figures and your fears. Starting a new business comes with all kinds of risks, but being prepared is the most important factor when implementing new systems. Embrace the digital age and now!

Here at CheaperPay we understand the importance of reducing the costs for your new business. This is why we’re offering 3 months FREE when you sign up with us! Contact us for more information.

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Is your business prepared for the cashless economy?

The UK is on the fast track to being cash-free, but are our small and medium businesses ready?

The pounds in your pocket are destined for the museum display cabinets. This is according to new research by trade association, Payments UK, who predict that debit card and contactless payment use will overtake cash transactions by 2021 after finding that cash transactions accounted for less than half of consumer payments for the first time in 2015.

There’s no doubt that contactless technology has transformed consumer buying, and with Apple and Android Pay now available, it’s clear that the days of counting out coppers for a pint of milk and a Mars bar will soon be over.

Who has the least cash?

Citigroup and London’s Imperial College latest Digital Money Index indicates that the UK has begun to sprint ahead in the global race to becoming a cashless society after rising from 7th to 4th place in the list of countries that are most ‘digital ready’. Finland topped the list as the most digital-ready country for the third consecutive year, with Singapore and the US following behind in second and third place respectively.

Finland’s continued position as a digital leader is unsurprising considering their strong investment in digital infrastructure. Fixed broadband is available to 97 per cent of Finnish homes; this combined with affordability has helped Finland become one of the most tech savvy nations, with 91 per cent of the population being regular internet users. Furthermore, according to the Digital Economy and Society Index (DESI), Finland has one of the highest shares of eGovernment users and users of eHealth services in Europe. The Finnish government’s integration of digital and public services has further embedded digital processes into everyday life, meaning that digital payment is just another aspect of efficient modern living.

Contactless: the consumer’s choice

The rapid change in the UK’s payment habits can largely be attributed to big brands’ early adoption of contactless. In 2014 Tesco updated all 6,000 of their payment terminals in London to accept contactless payment, they announced that this would save 6 seconds for every customer that used it. For a consumer that is often time poor, 6 seconds less spent in a queue is 6 seconds less stress but more importantly for Tesco it speeds up customer service which enhances the customer experience.

However, contactless payment hasn’t always been hailed as a hero. Transport for London’s (TFL) announcement that its buses would go cashless in 2014 was initially met with scepticism. Nonetheless, since TFL has rolled out contactless across its network, more than 400 million journeys have been made using credit or debit cards or a mobile device, revealing that contactless is an option that offers consumers more, not less choice.
While Tesco and TFL helped lead the way in implementing wave and pay into our everyday lives, the increase in the contactless spend limit from £20 to £30 further pushed contactless mainstream by boosting retailer opportunities and encouraging a wider range of merchants to adapt their payment systems. In 2016, from petrol stations to pubs, consumers can go about their daily lives without having to enter their pin.
Contactless may have won London over first, but a recent study by Barclaycard found that contactless is growing fastest in Manchester, Glasgow and Cardiff. Furthermore, the study also revealed that the over 60’s, the group often deemed as ‘technophobes’, are the fastest growing adopters of contactless card payments. The popularity of contactless across generations offers further evidence that wave and pay is here to stay as more consumers look to utilise new technology that will allow them to make safer, more convenient payments.

Better for business

The swift infiltration of contactless into our everyday lives has certainly raised customer expectations of the pace and ease of service, meaning that businesses not offering customers the payment options they expect, risk undermining their reputation by appearing out of touch.
However, the new way to pay offers considerable benefits to businesses too. Sage Pay’s Payments Landscape Report 2015, found that annual cash handling costs, including allowance for fraud and theft, set UK retailers back more than £3,600 on average. By offering cashless payment options, businesses will benefit hugely from reduced cash handling costs. While digital payments are not completely free from fraud, the risk is significantly lower. Figures from the UK Cards Association show that in the first six months of 2015, fraudulent transactions were equivalent to only 2p for every £100 spent using contactless functionality.

In addition to speedier, safer transactions, digital payments also open up the possibility of integrated reward programmes and location-based marketing. Tapping into these smartphone capabilities will allow businesses to use customer data to deliver tailored marketing campaigns, enhancing customer experience and encouraging loyalty.

While the question of whether the UK will turn completely cashless remains debatable, there’s no doubt that paying for a latte with a quick swish of your wrist has become so commonplace that digging deep in your purse for cash feels like an archaic practice. Whether you’re a high street store, independent coffee shop or a local newsagent, consumers now expect to be able to pay with lightning speed. Cashless is coming, make sure you’re prepared.


Growth Business UK. 2016. Is your business prepared for the cashless economy?. [ONLINE] Available at: http://www.growthbusiness.co.uk/comment-and-analysis/2532811/is-your-business-prepared-for-the-cashless-economy.thtml. [Accessed 24 June 2016].

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Huge shift towards PIN-less payments

The way we pay is changing, according to new figures – and much of the transformation is down to technology allowing us to “tap and go” at the checkout.

In September 2015, the limit for a payment that can be made using a contactless card was increased by £10 to £30 – enabling bigger payments to be made without the need to sign anything or enter a PIN.

According to industry trade body the UK Cards Association, contactless card spending topped £1.5 billion in the space of a month for the first time in March.

The new record was reached just four months after contactless spending reached £1 billion for the first time in November 2015.

Some 67 contactless purchases were made every second in March. There are around 86.5 million contactless cards in issue in the UK, including debit and credit cards.

The growing range of places where contactless payments are accepted includes Aldi, Barnardo’s, Greggs, McDonald’s, the M6 toll, London buses, London tubes and the Post Office.

And contactless has become so convenient that one in seven card transactions are now contactless, compared with one in 16 a year ago, according to the association.

So how will contactless spending affect the way we pay in the future?

Well, another report, from payments industry trade association Payments UK, predicts that debit cards will overtake cash to be the UK’s most frequently-used payment method by 2021.

Explaining why it expects debit cards to surpass cash, Payments UK says contactless spending is helping to boost card use.

In some cases, people don’t even need to have their plastic to hand – with mobile payment services such as Apple Pay and Android Pay also providing new opportunities for people to make payments.

In 2014, the volume of non-cash payments overtook total cash payments for the first time, at 52 per cent against 48 per cent.

But despite accounting for less than half of payments, cash has remained the most popular payment method in the UK compared with all the other various types of non-cash payment.
The tipping point at which cash will no longer be king is expected to come in 2021, when it is predicted 14.5 billion debit card payments will be made, overtaking the 13 billion cash payments forecast for the first time.

Looking at how we use our cards, Payments UK says the average UK adult made 20 card payments per month in 2015, with around two payments per month being contactless.

But by 2025 it expects people will typically be using a debit, credit or charge card virtually every day – at 30 times per month. Nearly half of these transactions – at 14 per month – will be contactless and many will be made by using a mobile phone – experts predict.


2015 (2001) Huge shift towards pIN-less payments. Available at: http://www.wiltshirebusinessonline.co.uk/news/14570648.Huge_shift_towards_PIN_less_payments/ (Accessed: 22 June 2016).

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Contactless nation: Transactions soar 230% in a year as British shoppers adapt to new technology

The number of Britons choosing to use contactless debit and credit cards to make payments has soared so that £1billion was spent in a single month for the first time, data shows today.

In November 2015, total spend using contactless hit £1.02billion – a 230 per cent boom on the same month last year, when spending using the technology amounted to £303million, statistics from the UK Cards Association show.

The figure is likely to be overshadowed by December’s spend as shoppers hit the high street for Christmas.

The industry body also found the average transaction value of a contactless payment increased to £8.03 in November, up from £7.72 in October, likely due to the payment limit increasing from £20 to £30 in September.

Contactless spending was up 10 per cent on October 2015, with the number of purchases up by six per cent on October to 128million.

The £1billion November represents huge growth for contactless. In November 2013, £81million was spent on contactless and November 2012, just £26million was collectively spent.

The huge rise has come as more people choose to make smaller purchases using contactless, but also after a relentless push from current account providers.

Most now send out replacement cards with contactless as standard, meaning more of us have them.

Rapid spike: How payments have increased in recent years on contactless credit and debit cards

Rapid spike: How payments have increased in recent years on contactless credit and debit cards

According to UK Cards Association, more than 78million contactless cards were in issue in November 2015.

This compared to 56million in November 2014, 37million in November 2013 and 31million in November 2012.

This is Money reported back in the summer of 2015 that those who do not want a contactless card can request not to have one, according to the banks we asked.

Some are worried about the security aspect after an investigation by Which? showed scanners can be used to swipe details.

However, last year, NatWest/RBS told This is Money that just 1,200 specifically asked not to have a contactless card out of nine million it had issued.


  • Nov-08: £44,968
  • Nov-09: £273,360
  • Nov-10: £963,208
  • Nov-11: £3,960,238
  • Nov-12: £25,762,239
  • Nov-13: £80,605,973
  • Nov-14: £302,684,649
  • Nov-15: £1,020,000,000

Richard Koch, head of policy at the UK Cards Association, said: ‘Spending on contactless cards has increased almost fourfold since the beginning of 2015 and for £1billion to be spent via contactless in a month is a major milestone.

‘Whether it’s buying lunch or paying for travel, there is a real appetite for contactless payments and this is only going to grow and grow.’

As a whole, total spending on payment cards in November 2015 reached £53.2billion, with the number of purchases at a monthly record of 1.174billion, with rises partly attributable to the impact of Black Friday and Cyber Monday.

Total online spending was £11.8billion, compared to £10.4billion in November 2014. The number of online purchases increased by 23 per cent year on year.

Boyce, L. and Lee+Boyce+for+T (2016) Number of transactions using contactless cards hits £1bn in a month. Available at: http://www.thisismoney.co.uk/money/saving/article-3410093/Contactless-nation-Transactions-soar-230-year-British-shoppers-adapt-new-technology.html (Accessed: 20 June 2016).


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Finger slip could be costly as contactless and cashless payments become more popular

BRITONS are frightened by moves towards a cashless society as one slip could see real money disappear in an instant.

A typing error, for example, could unwittingly send an electronic payment to a complete stranger’s bank account.

There is no guarantee you will see your money again or even receive compensation if you fall victim and some customers have lost tens of thousands of pounds.

Rising credit and debit card fraud is another worry, while contactless payments also leave users feeling vulnerable.

Losing contact

Older spenders are reluctant to lose cash as they believe it offers more security than other payment methods, according to new research from fraud protection specialist Defender Note.

Half of all over-55s would be upset if cash was phased out altogether.

Many are also wary of contactless cards and think their bank should ask for their approval before issuing the new technology.

Defender Note director Morgan Rothwell says: “Contactless card use is skyrocketing and cash is on the decline, but this is unsettling for many older spenders.”

Electronic payments are a quick and efficient way to transfer money to family or friends, or to settle oneoff payments, such as a household bill or a deposit on a major purchase like a car or property.

Contactless payment

Many are wary of contactless cards

However, if you key in the recipient’s bank details incorrectly, even with just one digit wrong, your money could go astray.

With around 25 million users of online banking, there have been regular reports of huge sums being sent to the wrong recipient.

Others have fallen victim to an evil new fraud where scammers intercept emails between house buyers and their conveyancing solicitors then con them into forwarding their property deposit to the trickster’s bank accounts.

According to research from Payments UK, more than half of us are wrong in thinking the recipient’s name is used to route online payments.

In fact, banks solely rely on the sort code and account number so it is vital you key in both without any errors.

Check the reference as well if you are paying a business.

Maurice Cleaves, chief executive of Payments UK, says that sending electronic payments has become second nature for many: “Although the overwhelming majority of payments are sent to the correct place, you must use the right sort code and account number.”

Take care

David Black, banking specialist at DJB Research, says the growing use of the new Faster Payments Service has added to the risk as your funds are transferred within hours rather than days: “There is no opportunity to spot and correct the payment if you have made a mistake.”

Setting up a forward payment to go out in one or two days’ time would allow you to correct any errors.

Black adds: “It also makes sense to send £1 as a test payment and ask the recipient to confirm receipt before sending the full amount.”

If you do send money to the wrong recipient, tell your bank as quickly as possible.

Black says. “If you are lucky, the incorrect numbers will not correlate to an account and your payment should bounce back to you or be held in a suspense account.”

Otherwise your bank will endeavour to retrieve the money on your behalf, but it can be a slow and frustrating process.

Person banking online

Faster payments add to the risk of funds going astray

Get it back

In January, the banking industry introduced new rules making it easier to recover misdirected money, but these apply only in straightforward cases where there is clear evidence of a genuine mistake.

Money can be returned within 20 working days where the recipient does not dispute the return of the funds, but banks do not have the power to pluck money from the recipient’s bank account without permission, even if it is not theirs.

The recipient has to consent to the funds being returned, so you are relying on their honesty.

Black says: “If not, you might have to go to court to get your money back. While your bank will try and recover your funds – and may charge for doing so – it will not be liable for any loss.”

The cashless society may be convenient, but any slip-ups can prove expensive, so people are right to be wary.


Jones, H. (2016) Home. Available at: http://www.express.co.uk/finance/personalfinance/680015/contactless-cashless-payments-lose-money-mistake (Accessed: 15 June 2016).

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Contactless cards went mainstream in 2015, UK Cards report shows

More consumers chose to pay with contactless cards last year than ever before, as the way of paying embedded itself firmly into everyday spending, figures from a new report show.

During 2015, contactless cards became the way to pay for millions of consumers who value the method’s speed and flexibility, The UK Cards Association’s report UK Card Payments 2016 shows.

In 2015, £7.75 billion was spent using contactless cards, compared to £2.32 billion in 2014, reflecting the increase in the payment limit to £30 and the growth of contactless transport ticketing. The growth in spend increased more than the growth in the number of contactless cards, with 49 per cent of the cards in issue having contactless functionality by December 2015, The UK Cards Association, which represents banks andcards issuers, says.

Transport operators and local authorities across the country are now seeking to emulate London’s experience of accepting contactless cards as a method of paying for travel, while charities are also working on contactlessgiving initiatives.

Consumers began to make card payments without their physical cards, as devices such as enabled smartphones and smartwatches allowed contactless payments.

Meanwhile, similar innovation within retail saw an increasing number of businesses begin to use mobile point-of-sale devices, giving them scope to adapt the way they serve customers and accept payments.

As of 2015 there are more than one million businesses accepting card payments, reflecting both retailers’ increasing recognition of the benefit of accepting card payments and the demand for flexibility and convenience from consumers.

As a result, consumers can now choose to use their cards at any of 1.2 million individual outlets in the UK.

In total, consumers spent £660 billion on debit and credit card purchases in 2015, an increase of 10 per cent from 2014, the publication shows.

Graham Peacop, Chief Executive of The UK Cards Association, said:

“With the amount spent using contactless cards almost trebling between 2014 and 2015 and the payment limit increasing to £30, it is clear 2015 was the year contactless went mainstream. Whether buying a sandwich on the go, or paying for a round of drinks or a tube journey, contactless has become the default way people choose to pay for every day shopping.

“A wide range of retailers are moving away from simply offering a traditional high street experience to embrace e-commerce and innovative ways of taking payments. At the same time, consumers are increasingly using their cards, and especially their contactless cards, for smaller and smaller purchases. With such convenience and flexibility, payment cards will continue to play a central role in the future.”

Card spending online was up 20 per cent, to £210 billion from £175 billion in 2014. By the end of 2015 half of online spending took place on tablets and smartphones, up from 37 per cent in 2014.

It means almost a third of card spending now takes place via the internet.

Supermarkets were the most popular destination for shoppers, which saw spending of £102 billion, equivalent to one in every seven pounds spent on cards. The average supermarket shop on a card is now £24.55, down from £26.11 in 2014, reflecting changing habits which sees consumers shopping little and often, and the migration of low-value purchases from cash to card.

Food and drink was the most common category for card payments, representing a third of all card purchases. The entertainment sector accounted for 15 per cent of purchases and saw a 20 per cent growth in the number of payments, with 26 per cent more card payments in restaurants.

UK Card Payments 2016 predicts debit cards will be used for 21 billion payments in the UK, worth £856 billion, by 2025. The next generation of account holders are expected to be a major factor in the predicted growth ofcard payments, with younger people more likely to embrace new technologies such as contactless cards and mobile payments, and to contribute to the growth of e-commerce.


Notes to editors:

  1. In 2015, £660,406 million was spent on payment cards in the UK, compared to £602,337 million in 2014 (a 9.6 per cent increase).
  2. There were 175 million cards in issue: 98.8 million debit cards, 59.0 million creditcards; 5.7 million charge cards and 12.2 million ATM-only cards.
  3. One million businesses in the UK accept payment cards through UK merchantacquirers, compared to 0.9 million in 2014. These businesses have 1.2 million outlets in the UK. Merchants are businesses, retailers and other organisations including the public sector.
  4. The average transaction value for all card payments at UK businesses continued to decline and reached £45.42, after falling by £2.06 during 2015.
  5. The food and drink sub-sector continued to dominate as the most popular category forcard payments recording growth of 7.7 per cent to 4.5 billion purchases and represented 34 per cent of all card purchases. The corresponding value accounted for 18 per cent of total card spending after growing by 0.8 per cent to £110 billion, likely subdued by a fall in grocery prices in 2015.
  6. In 2015, 84 per cent of all card transactions were purchases, with 16 per cent being cash withdrawals. By comparison, in 2005 70 per cent of all card transactions were purchases, with 30 per cent cash withdrawals.
  7. Total card payment volumes in the UK are forecast to increase from 13 billion in 2015 to 21 billion in 2025. The value of card payments in 2015 was £596 billion and is forecast to increase to £856 billion in 2025.
  8. By 2025 the volume of debit card purchases in the UK is forecast to surpass 17 billion, up by 70 per cent on 2015. The total value of debit card purchases in 2025 is expected to reach £672 billion.
  9. Online spending now represents 32 per cent of all card payments.
  10. Payments UK forecasts that in 2025 credit, debit and charge cards will account for more than half of all payments made (50.2 per cent), driven in large part by the increasing popularity of contactless.

News (2010) Available at: http://www.theukcardsassociation.org.uk/news/CardPayments2016news.asp (Accessed: 15 June 2016).

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1 in 4 UK shoppers intend to make a contactless payment with their smartphone in the next 12 months, says MasterCard

Following the recent UK launch of Android Pay, new MasterCard figures show that one-quarter of UK shoppers intend to use their mobile to make contactless payments in the next 12 months.

Despite the relative infancy of contactless mobile payment technology in the UK, 1 in 20 people are using it once a week or more. With more mobile handsets enabled for contactless payments, reservations are slowly beginning to disappear and as many as 13% of British consumers have no reservations at all, says the study.

Of the three quarters who don’t use it, the most common fear is losing the device. 65% of people worry that if their device falls into the wrong hands someone can use it to buy things with their money. Anecdotally, many of the others simply don’t yet see the point, don’t know they can and, in the case of one of this Editor’s nearest and dearest, “because she feels like a wally” doing so.

Elliott Goldenberg, Head of Digital Payments, MasterCard UK & Ireland said: “We have built the secure foundations for these payments across our network. You can load your MasterCard onto your device through Android Pay, confident in the knowledge that it gives you all the benefits and consumer protection of a card transaction. Our research shows that 1 in 3 people intend to link to their credit card for that reason.”

He continues: “Mobile phones offer people the means to make contactless payments over £30 because the user can be verified, for example by means of their fingerprint.  The other key difference is the use of digital tokens – in short, your card details aren’t passed onto the retailer because they are not stored on the phone in the first place. As consumers increasingly recognise these benefits, mobile payments will begin to see the kind of growth that contactless has had over the last two years.”

Developers can quickly enable Android Pay for in-app payments through the MasterCard Payment Gateway, making it easier for retailers of all sizes to accept in-app payments securely from Android users.

Android Pay is accepted at more than 400,000 contactless terminals throughout the country, as well as the 5 million contactless terminals in 77 countries around the world. To find a listing of contactless-enabled UK retail locations, download the MasterCard Nearby app or go to: www.mastercard.com/contactless.

MasterCard has created a way to digitally enable cards (through ‘MDES’), which has been built to ensure transactions can take full advantage of the most advanced payment security in the world.

In setting up a device for Android Pay, MasterCard generates a digital “token” that is associated with that device and stored on a secure server. Not only is that token number different from the actual card number but it is also prevented from transacting via any other device. When the consumer uses their mobile device in a transaction, it is the token provided to the store, and not the real card number.

Android Pay is available on a wide range of devices from various manufacturers and MasterCard has already worked with Bank of Scotland, Halifax, HSBC, Lloyds, MBNA and M&S Bank to enable their cards for use in the new scheme. MasterCard continues to work with further UK banks to enable more and more consumers to take advantage of this exciting new payments innovation.

MasterCard is ensuring that mobile devices will be able to be used almost everywhere for payments by requiring that all retailers across Europe which accept MasterCard, must also accept contactless payments by 2020 at the latest.


Skeldon, P. (2016) 1 in 4 UK shoppers intend to make a contactless payment with their smartphone in the next 12 months, says MasterCard. Available at: http://internetretailing.net/2016/05/1-4-uk-shoppers-intend-make-contactless-payment-smartphone-next-12-months-says-mastercard/ (Accessed: 1 June 2016).

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Contactless spending in Britain’s pubs, bars and restaurants shoots up following £30 limit increase

Contactless payments now account for one in 10 card transactions, and with contactless spend nearing £1bn a month, Barclaycard research indicates contactless is a huge potential growth area for UK retailers.

  • Spending in pubs and bars made by ‘touch and go’ payments has almost doubled (up by 92 per cent) since the contactless limit rose from £20 to £30 in September, according to Barclaycard data*
  • Contactless spending in fast food outlets and in restaurants has also jumped by 62 per cent and 51 per cent respectively over the same period
  • More than 8 in 10 consumers use less cash than they did a year ago with 19 per cent annoyed if they can’t pay using contactless cards or devices
  • With contactless now the preferred payment method for almost half of shoppers, a significant opportunity exists for the two thirds of merchants who do not currently accept contactless

Where’s Britain spending on contactless?

Service stations, pubs and bars, and fast food outlets have proved to be the key beneficiaries of the contactless limit increase, which rose from £20 to £30 on September 1st this year. Contactless spending in service stations, pubs and bars has almost doubled since August (up by 98 per cent and 92 per cent respectively), with spending in fast food outlets and supermarkets also climbing, both categories up by 62 per cent.

Across all spending categories, supermarkets have led the charge in the adoption of new payment technology this year. Three in 10 (30 per cent) of all contactless transactions are now made in supermarkets, and the £30 upper limit also means the average cost of a basket of goods – £25 – can now be covered in a single contactless transaction.

Category Spending growth following £30 limit increase
Service Stations  98%
Pubs and Bars 92%
Supermarkets  62%
Fast food outlets  62%
Convenience Stores  59%
Commuter transport 55%
Restaurants  51%
Pharmacies  49%
Newsagents  40%
Caterers  7%

58 per cent of merchant respondents to the Barclaycard survey said that customers are using mobiles and wearable devices more often to pay for goods and services. This suggests that newer payment methods such as Barclaycard’s bPay wearable devices – which include a wristband, fob and a sticker and can be used to make contactless payments at more than 300,000 terminals across the UK – are set to become a firm fixture in the payments ecosystem.

The Barclaycard research shows that just one in three merchants (34 per cent) currently accepts contactless, but with 83 per cent of shoppers also carrying less cash than they did a year ago – and 19 per cent admitting to being ‘annoyed’ if they can’t pay contactlessly – it’s now more important than ever for businesses to introduce ‘touch and go’ as a way to pay.

What’s in store for 2016?

Over the next 12 months, as consumers start to search for ways to make larger payments more quickly, high value contactless payments – where shoppers can make contactless payments over £30 using a mobile device with Chip and Pin authorisation – are also likely to become increasingly popular.

Early next year Barclaycard will become the first financial services brand to launch high value payments on Android devices, expanding the functionality of its mobile app to include contactless mobile payments. Barclaycard customers using this new feature will be able to make contactless payments for transactions up to £30, and for the first time, will also be able to make high-value contactless payments of up to £100 by entering their PIN on their mobile device.

In another UK market-first, Barclaycard is introducing an ‘instant card replacement’ feature to Android users. This will enable customers to have a lost or stolen card replaced immediately on their mobile phone. Customers simply report their card as lost, stolen or damaged by calling the contact centre for free from the Barclaycard app and the virtual replacement card will be instantly downloaded for immediate use. A plastic card replacement will then follow in the post.

Paul Lockstone, Managing Director at Barclaycard said:

“In 2015 we’ve seen contactless become an even more popular way to pay for small transactions, so much so that we can even get frustrated if a retailer doesn’t offer ‘touch and go’ as an option. As the consumer appetite for new ways to pay continues to grow, particularly with the upcoming launch of high value payments and the continuing growth in wearable payment devices, we’re expecting 2016 to be another recording breaking year for contactless.

“In the fifty years that we’ve been in business, we’ve played a key role in supporting the development of many new payment innovations – from introducing the first credit card to the UK, to launching Chip & PIN, Contactless and wearables. The consumer trend towards contactless is only set to increase, with our data showing that time pressed shoppers don’t like to hang around – there’s a real opportunity for UK retailers to step-in and meet this growing consumer demand.”


Finextra (2016) Contactless spending in Britain’s pubs, bars and restaurants shoots up following £30 limit increase. Available at: https://www.finextra.com/news/announcement.aspx?pressreleaseid=62560 (Accessed: 31 May 2016).