In 2023, an impressive 80% of the UK’s total population, comprising 50 million people, will engage in online shopping. Projections indicate that this figure will rise to 86% by 2027, encompassing 52 million individuals. With such a substantial number of consumers embracing online commerce, there lies a significant opportunity for digital business owners to tap into this market and boost their revenue.
However, as the online shopping landscape continues to evolve, so do customer preferences. Modern consumers seek a broader range of digital payment methods and expect a seamless checkout experience. The question arises: Have you adapted to these changing needs? If not, this blog is here to provide guidance.
Below, you will discover some prevalent payment trends in the UK, the top payment methods preferred by customers, and how businesses can offer these payment options effectively.
UK Payment Trends for 2023
Debit and credit cards have long been the primary payment methods in the UK, constituting roughly 90% of all retail transactions in the country. Notably, the UK boasts over 50 million credit card accounts, a number that continues to grow. Furthermore, industry giant MasterCard has introduced its B2B payment solution for UK businesses, indicating that card payments will remain a prominent trend in 2023 and beyond.
In addition to traditional card payments, various digital payment methods are gaining popularity, including digital gift cards, buy-now-pay-later (BNPL) services, Samsung Pay, PayPal, and Shopify. The increasing penetration of the internet and smartphones, combined with the growth of online retail, fuels this shift.
Overall, the UK’s payment market is dynamic, with an expected growth rate of 12.56% from 2023 to 2028. To thrive as a business, it’s imperative to offer the latest payment methods for customers to choose from. Let’s delve deeper into the top payment methods preferred by consumers in the UK.
Top 5 Payment Methods in the UK
The popularity of cash as a payment method has been steadily declining in the UK.
In 2023, only 17% of consumers in the country prefer using cash for payments, a figure expected to decrease further as alternative methods gain ground.
While accepting cash payments remains essential for offline stores, online businesses do not typically offer this option.
Debit cards reign as the most favored payment method in the UK, surpassing cash usage.
Debit cards account for approximately 70% of total retail purchases, while credit cards contribute 38% and are anticipated to capture a larger market share.
Bank transfers, facilitated through the bank’s application, offer a secure and increasingly efficient payment method.
While primarily used for transferring money, bank transfers are expected to gain prominence in e-commerce transactions.
With the surge in online payment methods, businesses in the UK must be prepared to accept digital wallets.
Notable digital wallets like Apple Pay and Google Pay, alongside PayPal, dominate the market.
Buy Now, Pay Later (BNPL)
BNPL services have experienced significant growth in the UK’s eCommerce industry.
In this payment method, a service provider covers the full purchase amount on behalf of the buyer, who then repays it in interest-free monthly installments.
BNPL simplifies high-value purchases, allowing customers to acquire goods without immediate full payment.
Local Payment Methods and Challenges for Businesses
Based on UK payment trends, digital payment methods are expected to dominate the market. Businesses that offer the digital payment methods preferred by customers will have a competitive edge and capture a larger market share. However, achieving this transition can pose challenges.
Businesses may struggle to identify locally popular payment methods and suitable providers, potentially leading to integration errors and higher costs. Integrating multiple payment methods individually can be logistically and financially burdensome, requiring setup fees and specialized engineers.
Moreover, each payment method may have varying levels of consumer protection and online security features, making the payment ecosystem vulnerable to cyber threats. It becomes the responsibility of businesses to fortify their payment systems and protect customer data.
Additionally, integrating multiple payment methods without a consolidated source of information can hinder data-driven decision-making.
Fortunately, there is a solution to these challenges: payment aggregation. By adopting a payment aggregation solution like Web Technology Expert, businesses can effectively address these issues and thrive in the UK market.
How Web Technology Expert Simplifies Payment Method Integration in the UK
Web Technology Expert is a global payment aggregator that facilitates integration with over 30+ payment gateways. With these 30+ payment gateways, businesses can accept credit cards, digital wallets, BNPL, bank transfers, and over 300 other payment methods.
The integration process with Web Technology Expert is straightforward, thanks to codeless integration. Businesses can select preferred payment gateways based on location and supported payment methods, enabling or disabling options through the Web Technology Expert dashboard. This flexibility streamlines scalability and reduces time and engineering costs associated with individual integrations.
Furthermore, Web Technology Expert holds PCI-DSS certification and GDPR compliance, offering secure payments without the need for additional security measures.
Finally, the Web Technology Expert dashboard provides comprehensive insights into payment data, enabling data-driven decision-making and enhancing offerings.
To discover how Web Technology Expert can boost your revenue, schedule a free demo today!