For the first time ever, card payments account for more than three quarters of all retail sales, that’s according to BRC’s annual Payments Survey.
The report indicates that this has partly been driven by UK customers increasingly using cards for lower value payments, traditionally dominated by cash, which now accounts 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, says BRC. 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.
“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,” said BRC head of payments and consumer credit Andrew Cregan.
“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.”