News

Study examines 'The value of cash on the UK high street'

New research from Cardtronics UK shows that nearly a quarter of 'main street' merchants have lost profits due to a decline in customer access to cash.

October 23, 2015

Although pressures on the U.K. high street are manifold, the vast majority of Brits still prefer the high street over any other shopping environment.

This is one of the findings of "The Value of Cash on the U.K. High Street," a study published by independent ATM operator Cardtronics U.K. and conducted by market research firm Populus.

On average, U.K. consumers visit shops on main street thoroughfares more than once a week (77 times per year) and spend 26 pounds (approximately $40) per trip. Consumers choose this shopping venue because of its convenience and the fact that high streets are often a focal point for local community life.

The Cardtronics study found that virtually all high street shops today accept card payments, but these payment options come at a cost. Stores spend 2 percent of their annual turnover to accommodate noncash payments.

On the consumer side, Brits prefer cash over cards for purchases of less than 17 pounds ($26), which explains why half of the turn at high street retailers is generated through cash payments. In many cases these payments are enabled by local ATMs, which directly account for 36 billion pounds ($55 billion) of the annual high street economy, Cardtronics said.

Other findings from the study:

• Of retailers who have added new payment systems over the last two years, only 30 percent said that their investments have had a positive effect on business performance;
• Nearly one-quarter (24 percent) of merchants suffer from dwindling profits due to decreasing cash access on their high streets. This is mirrored in the consumer data, which shows that up to 11.7 million Brits will abandon their high street if they are not offered the convenience of withdrawing money and shopping at the same time.
• Almost half (42 percent) of retailers said that businesses on their high street have started offering ATM services due to the rising trend of local bank branch closures, particularly in smaller communities.

"The report showcases the rising importance of the partnerships between high street retailers and alternative providers of financial services," said Tim Halford, commercial director of Cardtronics U.K. "Retailers fight to stay afloat, but a range of pressures still stifle their efforts: they range from ever changing trends in new payment technologies, to the retreat of local banks through to separate business rates on many retail ATMs. As such, it is now more important than ever that we rally to support the high street as the U.K.'s prime local retail hub."

The full findings of the report, "The Value of Cash on the U.K. High Street," are available online.