The British Retail Consortium (BRC) has recorded that for the first time in UK’s banking history, Debit Cards have become the No.1 payment method for end-users, as the newfound ‘currency’ for transactions.
The Consortium report noted that by the end of 2016, Debit Card payments in the country had already grown by 4.5%, straddling almost 43% of all retail payments countrywide.
In striking contrast, was the shrinking of cash transactions which came down by 4.9% to gain only 42% of the total volume of retail transactions made during the year.
The emerging inference is that an increasing number of UK-ites are realizing the benefits of convenience, safety and security, and time-savings associated with the use of plastic money instead of hard cash.
A major factor that has contributed to the rise in the use of Debit and Credit Cards is the attraction of contactless payments followed by the fact that a larger share of retailers have invested in technology to accept new payment applications – online and in-store.
Investments are also being made to ensure cash users are catered to. Some £30 million was spent by retailers last year on preparing for the new plastic £5 note, with more costs coming this year when the new £1 coin comes online.
Meanwhile, the trade group claims that its campaign on interchange fees has reaped major rewards for customers, with new EU rules helping to save hundreds of millions of pounds. However, the group says the government should act to ensure these benefits are maintained once the UK leaves the EU.
Policy Advisor, BRC, Mr Andrew Cregan, says: “A growing number of retailers have invested in payment technology to accept cards, contactless payments and new payment applications both online and in store. In part, this has been facilitated by the Interchange Fee Regulation (IFR), which was introduced across the European Union following a successful campaign by the BRC and has led to a significant fall in the cost of collection that benefits retailers and their customers. Looking ahead, the Government should act to retain the benefits of the IFR for retailers and their customers after the UK leaves the EU and introduce further regulatory action to address the alarming increase in other card fees and charges at a time when the retail industry is facing acute cost pressures elsewhere.”