North East businesses losing sales due to outdated payment methods, says PayPal

Small firms across the North East are losing sales by limiting themselves to older forms of payment like cash, cheques and bank transfers, according to new data from fintech giant PayPal.

The firm’s latest research found that 60% of North East consumers will perform a Google search for goods or services at least once per week, but just one in four (24%) of the region’s businesses have an ecommerce website.

Furthermore, two fifths (41%) of the businesses surveyed admitted having never reviewed their customer payment methods, despite the introduction of new tech such as digital wallets and contactless payments.

According to PayPal, mobile shopping is growing at close to four times the rate of overall online spending in the UK.

The company’s research found that just under one fifth of North East consumers (19%) most frequently buy goods or services online using their smartphone, and yet only 20% of small businesses in the region have a website designed to be accessed on a smartphone.

Additionally, just 6% have a mobile app that can take payments.

Cash is still the region’s most relied-upon method of taking payment when trading in person, at 71%, followed by bank transfer (57%) and cheques (49%).

The survey also discovered that 36% of small North East firms maintain a presence on social media. Of those that do, 78% have seen sales increase.

PayPal UK’s director of small business, Nicola Longfield, said: “For small businesses, understanding the number of new ways to take payment may seem daunting.

“At times it can feel like a new “pay” launches almost every week.”

She continued: “However, consumers are embracing these changes and opting to use digital wallets, contactless cards and their smartphones when they go shopping. Businesses that don’t join the 21st century stand to lose out.”

PayPal’s research surveyed 2,000 small businesses and more than 2,000 consumers from across the UK.