The Post Office is urging high street retailers to keep accepting cash when card payment systems fail, after new research showed digital payment outages cost businesses an average of £255 an hour and forced nearly a quarter to turn customers away.
Research commissioned by the Post Office found that UK retailers experienced an average of three payment disruptions over the past year, with each outage costing an estimated £255 for every hour it lasts. The survey of 2,000 UK consumers and 500 high street retailers, conducted by Censuswide in October, revealed that 24% of retailers had been forced to turn customers away, delay or pause transactions during disruptions, while 22% reported having to close because they could not serve customers.
Cash as a resilience gap
While 83% of businesses surveyed have a written or agreed contingency plan, 90% do not include accepting cash as a back-up, despite 81% agreeing that keeping cash available for customers and emergencies is important. Cash helped 69% of businesses continue serving customers during digital payment outages, but only 32% of high street retailers surveyed currently accept cash, highlighting a potential resilience gap.
The findings come as the Government launches its 'Be Ready' campaign, encouraging households to keep cash and essential supplies at home in case of emergencies. The Post Office is now urging businesses to take similar precautions, calling on retailers to review their contingency plans and ensure they can continue accepting cash when digital payments are unavailable.
Guidance for retailers
Ben Hunter Woollard, head of banking at the Post Office, said: "A payment outage can disrupt trading in seconds, resulting in customers being turned away and sales lost. Cash has helped many retailers continue trading during recent disruptions, but it is rarely included in formal contingency plans."
He added: "With the Government encouraging households to keep some cash available for emergencies, retailers should also consider how they will keep serving customers if digital payments go down in emergencies. If cash usage is being encouraged, so should its acceptance. Our new guidance gives retailers practical steps to communicate clearly with customers and build a plan that works for their business."
Cash-only transactions contribute an estimated £27 billion to the UK economy. While contactless cards are now the most commonly preferred payment method, cash is the number one choice for over a fifth (22%) of consumers and used by more than half of the nation (58%) for everyday purchases, according to the research.
Customer payment preferences
Among UK adults who have been unable to pay at a store checkout in the past year, 21% said this was because the business did not accept cash. For 68% of those affected, being unable to pay happened on more than two occasions. Only 28% of high street retailers say community needs and customer payment preferences influence their decisions about which payment methods they offer.
Ed Woodall, chief executive of the Association of Convenience Stores, said: "Cash remains an important payment method for customers in convenience stores, with 99% of convenience retailers accepting cash. When people lose access to other payment methods through outages or issues with networks, cash is a crucial safety net that allows businesses to continue trading and serving their communities."
To support business resilience, the Post Office has published new guidance to help retailers plan for payment disruptions, meet local customer needs and clearly communicate payment options.
