What would a cashless society mean for the retail sector?

By Theresa Lindsay, Group Head of Marketing, Hitachi Capital UK 

There can be no denying that that the COVID-19 lockdown measures have drastically changed the ways that consumers browse and purchase goods. Out of necessity, consumers across all demographics have become more adept at buying online and making cashless payments. But just how far are we from a truly cashless society, and what does this mean for the retail sector?

Whilst the vast majority of stores have now reopened their doors, retailers should not underestimate the impact that social distancing measures have on store capacity and the customer experience, meaning that many customers may be slow to return to bricks and mortar stores. Therefore, it is vital for retailers to utilise technology to transform the in-store experience and adopt enhanced direct delivery methods as consumers become increasingly confident in using mobile browsing solutions and making payments online.

The high street has changed forever. Fundamentally, it is essential for retailers to adopt a truly omnichannel approach through technological innovation, by investing in their e-commerce channels alongside physical stores at every stage of the customer journey.  Retailers must make the end-to-end experience as seamless as possible, ensuring that all elements of the customer experience have been carefully considered. The retailers that achieve this will also most likely become the popular choices amongst consumers in the long term.

Interestingly, it is no longer just younger and city-dwelling consumers embracing technology which facilitates the cashless revolution. Our survey of 2,000 UK consumers1 has shown a seismic shift amongst rural and older communities too who are increasingly adept and confident browsing and buying online. 70% of consumers in rural areas are more comfortable with cashless payments since the beginning of lockdown, compared with 55% in urban areas. The over 55’s are also embracing cashless payments, with two-thirds (66%) more comfortable with cashless payments since the lockdown in March.

This should give retailers the confidence to launch or enhance their in-store and e-commerce channels with the knowledge that more customers from all demographics are now more likely to purchase online than ever before.  Our own research indicates more than two-thirds of consumers (68%) now feel more confident in making cashless transactions, while around half (52%) indicate they are prepared for a transition to a largely cashless life.  This presents a significant opportunity for many small to medium sized retailers who should be taking advantage of this behavioural shift to go online and open their businesses up to a wider customer base.  Supplementing footfall with click through rates.

Nevertheless, customer concerns around online and cashless payments must be addressed; notably security and fraud (42%) followed by a lack of availability for card or contactless payments at retailers (31%), and potential technical issues (30%). In this increasingly digital environment, retailers must invest in these technologies and ensure their e-commerce channels run as smoothly as possible.

As a point of sale finance provider for over 3,200 retailers in the UK across a broad range of sectors, we’re helping our retail partners better understand the impact of this changing landscape, whilst enabling them to offer a wide range of affordable financing solutions for their customers. Whether in-store or online, delivering a true frictionless journey is vital for retailers as they respond to evolving consumer expectations in a post COVID-19, digital world.

1Research of 2,042 UK consumers aged 16 – 55+ commissioned by Hitachi Capital UK carried out on 25th – 26th May 2020 by Censuswide.


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