UK retailers ready to embrace new payment systems by 2012-15

The UK is set to be at the forefront of the changes in payment systems that are predicted to sweep across Western Europe in the next four to seven years. A recent study, commissioned by Visa Europe, reveals that UK retailers are particularly keen to embrace new payment technologies ahead of their European counterparts, and by 2012-2015, anticipate these being a key factor in their retail outlets, both physical and online.

The findings were taken from ‘The Store of the Future 2012 - 2015', a report conducted by the Centre for Retail Research, UK, which surveyed retailers from 300 large and medium businesses across seven western European countries on their predictions for the future of retailing in 2012 - 2015.

It found that not only does the UK have one of the highest proportions of electronic retail payments of all countries surveyed (65%, predicted to rise to 73% by 2012-2015), but UK retailers were also ahead of the majority of their European counterparts in recognising the importance of electronic payments in achieving customer controlled transactions (e.g. self-checkout at supermarkets and pay-at-pump at petrol stations). Over half of UK retailers listed it as either ‘important' or ‘very important'. By comparison, only 44% of German retailers responded in the same way.

UK retailers are some of the biggest advocates of advanced payment technology in physical stores by 2012-15. This includes multi-application payment cards (47%), payment by mobile phone (40%) and contactless payment (30%). In addition, the research discovered that UK retailers are most likely to see future advantages in combining loyalty schemes with payment cards, with 32% most likely to hold this view, compared to 24% in Italy.

“It's clear from this research that UK retailers see payment technology playing a critical role in their businesses over the next few years,” comments Kevin Smith, VP, payment services, Visa Europe. “Contactless payments, in particular, were highly rated among the respondents. Our challenge going forward will be to educate both retailers and consumers about the benefits this and other technologies have in creating an efficient shopping environment for the future.”

Highlights from the report include:
• Almost 70% of retailers think the overwhelming purpose of retail websites will be transactional in 2012-15, while a fifth see them as being informational
• More than two thirds of retailers expect to launch a new store format alongside existing ones, with retailers in the UK and Netherlands most likely to do this
• Most likely changes to store formats include more information services in stores and local pick up for customers
• By 2012-15, 48% of retailers are expected to provide electronic devices for customers in the form of electronic kiosks or PDA-type devices with retailers in Sweden and Germany most likely to introduce these technologies (53% respectively).

In Europe, there are over 350m Visa debit, credit and commercial cards. In the 12 months ending December 2007, those cards were used to make purchases and cash withdrawals to the value of over €1.3trn. 11.4% of consumer spending at POS in Europe is with a Visa card.