Small to medium-sized enterprises (SMEs) could be losing as much as £800 million a year by not accepting credit or debit card payments.
This news is the main headline following research conducted by PayPal, which spoke to 1,000 SMES on the subject.
Nearly two-thirds of respondents said that they were yet to accept these types of payments – which cost them each around £1,800 over the course of the year, while one in ten lost even more.
The finding suggests that this refusal to adapt with advancing technology could be holding many firms back when it comes to potential future growth.
So why are so many companies so reluctant to take the leap? Apparently cost is one of the main deterrents, with 13 per cent of SMEs saying high monthly usage fees put them off investing in their own card readers, which almost a tenth admitted that charges relating to the set-up of Chip & PIN machines were another major obstacle.
PayPal’s director of mobile merchant services Narik Patel said: “One of the challenges small businesses in the UK face is getting paid. Nowadays few consumers are carrying a cheque book with them, or even cash.”
He added that this highlighted a growing need for SMEs to offer their customers alternative methods of payment, unless they wanted to risk missing out on a sale.
The company is now offering its own option for businesses, called PayPal Here. This service doesn’t force firms to pay a monthly fee – with the only costs involved being the initial purchase of the Chip & PIN card reader and a transaction fee for every sale that is made.
While it has been available since August, PayPal’s research suggests that at the moment, not many SMEs are aware of its existence.
Would you be interested in using it? Or are you happy operating via cash, cheque and BACS?
Posted by the Secret Businessman