Addressing the pain points of UK retailers: a new approach to payment solutions.

In the rapidly evolving retail landscape, keeping tabs on your margins is more critical than ever. The surge in card payments, often perceived as a boon, has unwittingly ramped up costs for retailers, squeezing already thin profit margins. A recent British Retail Consortium (BRC) report revealed that retailers incurred £1.3 billion in costs just for accepting card payments in 2021. Add to that the grim picture painted by rising credit card delinquency levels and consumer financial stress, and you've got an industry in dire need of resolute action.

Card Payment Costs – A Sore Point for Retailers

As cash has increasingly fallen by the wayside, particularly during the pandemic, retailers have found themselves cornered. The drop in cash transactions to a mere 15% of all transactions last year was accompanied by an increase in debit card payments, accounting for 67% of consumer spending. But this transition hasn't been without its pitfalls.

Debit card scheme fees saw a 28% rise compared to 2020, adding an extra £141 million in costs for retailers. Small businesses are further burdened with merchant processing fees ranging from 1.5% to 3.5% per payment.

Credit Woes and Financial Instability

A FICO report states that the percentage of customers missing at least one payment has increased month-on-month. On top of this, the number of accounts with one missed payment rose by 10.8% in just one month and by 9.2% year-on-year. This underscores a worrying level of financial stress among consumers, which is unlikely to bode well for retailers in the long run.

The Regulatory Quagmire

Although the Payment Systems Regulator has initiated market reviews into card fees, actual change might still be two years away. Retailers can't afford to wait that long. With the cost-of-living crisis tightening its grip, the industry needs urgent solutions.

Tymit's Solution: Innovation Meets Customer Value

Our co-branded instalment credit card program serves as a beacon in these challenging times. Seamlessly integrating with existing payment systems, the offering delivers a transparent, cost-effective payment solution tailored to the unique needs of retailers and merchants.

1. Instant Savings: By slashing merchant fees, immediate financial relief is brought directly to the bottom line of retailers and merchants.
2. Smart Analytics: The technology goes beyond just transactions, delivering real-time data that enables retailers to understand their customers better. This, in turn, helps in the development of targeted promotions and robust loyalty programmes.
3. Robust Security: In a climate where payment security is more critical than ever, multi-layered security protocols exceed industry norms, ensuring that every transaction is secure.
4. User Experience and Convenience: Adopting the best practices from the fintech sector, the platform employs Open Banking technology to offer real-time payment alternatives that are both cost-efficient and convenient for the customer.
5. Customer Financial Health: The co-branded instalment credit card programme empowers retailers to offer flexible payment plans to their customers. This aligns with growing calls for financial prudence among lenders, ensuring that customers not only spend wisely but also remain loyal to the brand.

This holistic approach not only optimises payment processes for retailers and merchants but also improves user experience, enhances customer loyalty and retention, and offers invaluable data insights. The offering is the comprehensive solution that UK retailers and merchants have been waiting for.

The Time for Action is Now

As Hannah Regan , payments policy advisor at BRC, aptly says, “We need urgent intervention from the Payments Systems Regulator and the Treasury to stop card schemes from abusing their dominant market position”.

The question then is not whether we can afford to adopt new payment technologies but whether we can afford not to.

Contact us today to discover how we can help you navigate this financial labyrinth more effectively. Isn't it time you explored what we can do for you?