Survey Shows SMBs Relied on Digital Payments to Survive 2020.
By Electronic Transaction Association
A new survey of small and midsized businesses (SMBs) conducted by the Electronic Transactions Association (ETA) and The Strawhecker Group (TSG) found that 43% of SMBs see digital payments as more important to their business now than before the COVID-19 pandemic. As SMBs begin to recover, 38% report an increase in sales since the beginning of the pandemic, and fewer SMBs are experiencing a decrease in sales (38% in 2021 vs. 47% in 2020).
Consumers and Merchants Embrace New Ways to Pay Due to COVID Conducted in April 2021, the survey revealed a notable shift during the pandemic in the ways in which consumers pay for goods and services. Digital wallets are now accepted by 44% of SMBs and are the third most common way to pay after credit/debit cards (70%) and cash (64%).
Since April 2020, over a quarter of SMBs have added a new sales channel, compared to 18% just a year ago. Merchants have incorporated services such as buy now/pay later (BNPL) options (13%), mobile applications (26%), in-store contactless payments (30%), ecommerce solutions (15%), and online delivery and pickup (17%) features to reach new and existing customers.
"The digital transactions industry continues to serve as a valued partner to SMBs," said Jodie Kelley, CEO of ETA. "Payments partners are helping businesses innovate to meet their customers where they are at by offering new products and services for safe and seamless transactions."
Contactless Payments Help SMBs Stabilize Sales Contactless payments, the ability to pay via a contactless card or mobile wallet at the point of sale, continue to see an increase in adoption by consumers and merchants: 34% of merchants state they are experiencing an increase in contactless payments, up 7% over the previous year. Of note, the survey results point to a shift toward merchants' willingness to embrace contactless payments, with more respondents being receptive to adding contactless payments.
"Our survey found that SMBs are implementing new strategies to meet customers' desire to pay in a safe way," said Mike Strawhecker, President at The Strawhecker Group. "Payments technology continues to be a key strategy as more businesses implement new sales channels, products, or efforts to stabilize their business."
In April 2021, TSG and ETA surveyed 528 SMBs in the U.S., with the goal of understanding how the COVID-19 pandemic is impacting SMBs' operations and payments acceptance, and how the current status of the market compares to April 2020. All survey responses are from SMB owners or managers. The survey represents SMBs across various U.S. regions and industries, and the margin of error is +/- 5% at a 95% confidence level.
Click here for your copy of the report.