Capital on Tap provides a full analysis on how COVID-19 has impacted the way we pay for goods and services, answering questions and providing expert commentary on what the future of finance will look like.
With COVID-19 affecting businesses in a variety of ways, Capital on Tap has taken a look into what the future holds for the world of finance, how spending is changing and how businesses are adapting to the change. The white paper also provides expert commentary for those seeking advice on their finances during this difficult time. Broken into five key sections, the white paper covers:
- COVID-19’s impact on finance
- The move to a cashless economy
- How businesses are adapting to change
- The room for FinTech startups
- Expert advice on managing finances
Card and online payment services prove most popular method for purchasing goods and services
From the outside there seems to be a clear direction that we’re heading in within the business world – digital finance. With its speed and efficiency being a clear desire, many businesses are beginning to turn to platforms which provide the ultimate digital finance solutions.
The graphic below shows the payment methods consumers are using to purchase goods and services:
Capital on Tap spoke to Matt Hicks, the Commercial Director at Codat, who shares his thoughts. “Lockdown has totally transformed the way individuals interact with businesses. From the more obvious cases such as online shopping to the more groundbreaking changes such as healthcare, like a GP consultation, or Education, such as a university lecture, becoming virtual and perhaps remaining virtual for years to come.
“The digitisation and personalisation of the application process and the free flow of relevant data from customer to bank can lead to far better customer service/ relationship management.”
COVID-19 has caused an acceleration in the way businesses are needing to adapt to digital finance. In a world that is constantly moving forward with advancements in technology, digital finance has only followed suit and therefore has meant that businesses need to become aware of how they operate financially in the future in case they get left behind.
Data shows the drop in ATM usage during COVID-19 as we move towards a cashless economy
The move towards a cashless future seems to be taking a step forward every day. With debit cards being the new norm to pay for items and businesses using online providers to complete transactions, the need for cash is dying out.
According to data from Link, which operates the biggest network of cash machines in the UK, ATM transactions reduced by 62% year on year at the start of the UK’s lockdown. Volume has begun to pick up due to businesses reopening, but there will not be a big bounce back according to Link’s Chief Executive – John Howells
Is there an argument to say that there will be a need for cash in the future? Experts share their thoughts on the future of our economy;
Pranav Sood, Head of SMEs at Gocardless comments, “By any measure, use of cash has dropped significantly through lockdown. Link, which operates the biggest network of cash machines in the UK, showed that cash usage had halved as shops shut and people worried about hygiene.
“Electronic payments have been the norm for everyday commerce for a while now and some parts of the economy and society are likely on the verge of becoming cashless. However, there are millions of people in the UK, many of whom are vulnerable, who still rely on cash. Getting to a fully cashless economy will require us to tackle some difficult questions about financial inclusion and so I think it will take a while to get there.”
Experts share their advice on moving finances to digital platforms
Moving finances to a digital format can seem like a daunting task. Although it seems digital is the future, it still takes time and consideration to ensure you make the correct decisions for your company. Capital on Tap asked experts to share some of their advice on moving to a digital finance world and things you should be aware of.
Sarah Young, VP of Member Engagement Marketing at TIDE comments, “Think about your finances and admin as one homogenous task, rather than many small tasks and look at banking providers that can take care of as much of it as possible.
“Digital banking providers are able to take care of admin such as invoicing, expenses and payroll, as well as basic banking services.”
Richard Wagstaff, CEO of Degree53 says, “Research the best provider for your needs and the types of services your business might require. Business owners often have issues with banks flagging up fraudulent transactions from their cards, so resolving these issues and activating the card or issuing a new one quickly is key for maintaining a good relationship with the customer.
“Customer experience is key. Just having a digital product won’t mean an upturn in business. Today’s users are looking for a frictionless experience at all times.
“Take the leap! Transaction fees are off putting to some traditional businesses, however in reality, people are likely to spend more digitally than with cash, so the benefit far outweighs the transaction fees.”
Capital on Tap CRO Tim Trailor shares his advice – “The main one I’d have is to shop around – understand the pricing of various accounts, but also the services they offer (a good integration into your accounting software may save you hours in the long-run!)”
To view Capital on Tap’s full white paper, click here.