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UK payments: the flourishing, just still growing, dying AND the too expensive

Two sets of stats published recently in the UK reveal some basic trends that have implications for payment systems worldwide.

Payment statistics for UK clearings

The July 2017 statistics from the UK payment systems operators:

Source & Copyright©2017 - UK Payment Systems operators

reveal that:

  • The flourishing are: Faster Payments and mobile (which generate many of the single credit payments)- still generating 15% growth (with single credits - 22%)
  • Just still growing are: direct debits +5%, CHAPS payments +5%
  • The dieing are: paper based systems at -14% to -19%/annum.

Retailers’ statistics and still complaining that payment costs are too high

The British Retail Consortium’s (BRC) annual Payments Survey on 2016 showed that:

  • cards accounted for more than 50 per cent of all retail transactions by volume. And that, for the first time, the volume of retail purchases made by card now accounts for more than half of all customer transactions. 
  • the new regulations on card interchange have delivered savings of around £500 million for retailers and their customers from the EU Interchange Fee Regulation (IFR), which caps some of the fees for handling credit and debit card transactions.
  • Debit card purchases have overtaken cash for first time
  • Consumers have become less reliant on credit cards.

BRC’s analysis of the average per transaction cost shows that cash is still the cheapest:

Source & Copyright©2017 - British Retail Consortium  

Not surprisingly, the BRC write, “The burden on businesses is still high. Despite these savings from the IFR, retailers still spent over £1 billion last year to accept payments from customers and the cost of processing cards remains high, particularly for credit cards.”

CTMfile take: Faster Payments, mobile and cash payments forever. Neverthless, are the costs of the card payment systems still too high?

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