THE BRITISH RETAIL CONSORTIUM'S (BRC) ANNUAL PAYMENTS SURVEY REVEALS THAT COST OF ACCEPTING CARDS REACHES ALMOST £1 BILLION.
For the first time the value of retail purchases made by card now accounts for more than three quarters of all retail sales, according to the BRC's latest annual Payments Survey, released today. This has partly been driven by UK customers increasingly using cards for lower value payments, traditionally dominated by cash. Cash fell again by more than 1%, accounting for just 22% of all retail sales.
As card payments have become more dominant, retailers have expressed concern at the rising costs of accepting cards. The Survey revealed that retailers spent an additional £170 million to process card payments in 2017, reaching almost £1 billion for the year.
The research showed that increasing costs have been driven entirely by card scheme fees, which jumped by 39% in 2017. The scheme fee increases to retailers in 2018 range between 30% and 100% for some transactions.
The BRC is calling for action from the Government and the Regulator to address the problem of soaring scheme fees borne by businesses, large and small, which come at a time when retailers are facing cost pressures elsewhere.
Commenting on the Survey’s findings, BRC Head of Payments and Consumer Credit Andrew Cregan, said:
“EU payment regulation introduced in 2015 delivered savings for the retail industry and consumers, but these benefits have now been eroded by increases in other card fees. In fact many smaller retailers have questioned whether savings were ever passed on by card companies. The BRC are now looking to the Government and Regulator to tackle the alarming increases to card scheme fees imposed on retailers, and for action to simplify the complex fees and charges levied by the card payments industry.”
- The BRC Payments Survey data is a sample from 48 per cent of the entire retail industry.
- The 2018 Survey looks at the methods of payment UK shoppers are using when buying goods in store and online, how this differs from previous years and the average cost to the retailer for handling each method of payment.
- Total UK retail sales rose by 4.3 per cent in 2017 to £366 billion (2016: c. £351 billion)
- There were almost 20 billion retail transactions overall in 2017 (2016: c. 19 billion)