A new survey suggests that the UK could soon be embracing cryptocurrencies and other alternative payment methods en masse.
Echoing the YouGov survey we reported on earlier this month, both businesses and consumers believe that a “payment revolution” is taking place, with methods such as cash quickly becoming obsolete, reports ‘The Daily Telegraph’ newspaper.
Out with the old
The Payments Landscape Benchmark survey organized by payment processing merchant Sage Pay, asked 1,124 business leaders and 1,042 consumers for their views on the future of making payments.
From the business sector, 29% of respondents considered cryptocurrencies to be an important part of the future of payment handling in the UK. Coming at a time when Bitcoin is still relatively unexplored by the general populace, both consumers and business, this figure is surprisingly encouraging.
While education about cryptocurrencies’ advantages is gathering momentum in many countries, aside from allowing businesses to avoid card processing fees, the survey highlights the need to eliminate other sources of financial loss.
The average cost for a UK retailer to accept cash has become £3,638.57 per year, due principally to theft, counterfeit currency and human error such as accounting mistakes. An integrated Bitcoin PoS system, for example, would eliminate all three of these loss-generating problems.
A third of consumers furthermore rated Bitcoin as one of their potential payment preferences, despite only 1% having used it in the past month. This is if anything an improvement on the YouGov result, in which 11% of those asked said that they were interested in using Bitcoin because of its specific features.
There are skeptics, however. Simon Black, Chief Executive of Sage Pay, told the Telegraph that “For many companies, Bitcoin is still more of a PR gimmick” and that “Too many businesses are focusing on Bitcoin when they should give customers the options they really want, like credit, debit, and contactless payments, or Paypal online.”
It is most likely that the desire for such payment methods is motivated by education and relative satisfaction with the status quo. However, all card payments as well as PayPal contain fees for merchants, many of which are often passed on to the customer, particularly with small UK businesses such as independent shops and pubs.
While these fees are unavoidable, retailers appear to be caught in a Catch-22 situation. A survey by PayPal last year suggested that small businesses were losing up to £800 million per year by choosing to accept cash payment only and shunning cards. “One of the challenges small businesses in the UK face is getting paid,” said Narik Patel, Director of Mobile Merchant Services.
It is most probable that contactless payment will make waves in the UK market before cryptocurrency can gather sufficient interest. However, as both merchant and customer look for a way to reduce costs, it could well be that Bitcoin or its derivative subsequently becomes the preferred transaction method in the years going forward.
Expert's opinion from Aaron Koenig "Bitcoin is the option that people really want, once they understand how many advantages Bitcoin has over the old monetary system. It absolutely makes sense for companies to focus on a new and better system rather than riding a dead horse."