The increase in use of Debit cards in the Netherlands
and what this means for retailers.
In the era of digitalisation, there is a change in the way that consumers are paying for products and services. The DNB Working Paper highlights exactly this citing a 22% increase in the use of debit card transactions and an overall fall in cash payment.
Why the increase?
Many physical stores across The Netherlands are already equipped for contactless (swipe) payments up to the limit of €25. Today, banks only issue debit cards that are capable of contactless payments and contactless payments by phone are now emerging with the number of pilots increasing. Other factors that contribute to the increase in use of debit cards are:
Product Price Tag – The monetary value of goods influences payment type. Convenience stores still take a high number of cash payments due to items they stock having a lower price points. Consumers that purchased items higher in price pay by card and with the increase in higher value transactions, card is becoming the turn to payment method.
Physical Store vs Web Shop – The place of purchase has changed with the introduction of web shops and auction sites that offers the consumer a shopping experience but without having to leave home. Online payment transactions familiarises the consumer with making payments by card when visiting a physical store and increases the level of trust the consumer has in the retailer handling their personal data securely.
Expendable Salary Levels of affluence change the way in which consumers spend their money. Searching for the best deal and getting more for less is a social normality now, but there are still consumers who want the best and are willing to pay a premium for branded goods due to the perceived value in the exchange. This value can be personal to each consumer or an individual brand could create market value making it acceptable for consumers to pay for the higher priced item, driving a behavior in society where the consumer believes “I can afford this brand” when it may not necessarily be the case. Brands that create this mindset protect their retail prices by giving low margins or control retail prices by punishing retailers if they sell below retail price.
So what does this mean for retailers?
Retailers will continue to see a decrease in cash payments and an increase in card transactions so should be prepared to take card payments to retain customers as there is a chance the consumer will go to a competitor if they are not carrying cash. This potentially leaves the retailer as a showroom where products are displayed but not purchased due to customers being aware of cheaper, on-line deals that are accessible through their tablets or phones whilst stood in the store. Retailers can combat this by offering an on the spot price promotion such as discount or simply queue bustling to ensure the purchase is made quickly as no one likes standing in a lengthy queue at the checkout.
Although this may be the case in Retail, other industries such as Hospitality still see a higher request and acceptance of cash payments.
How can The POS Company and Star Micronics help Retailers prepare for card payment?
The POS Company is Star Micronics primary distributor in Benelux and offers a range of products for industries including Logistics, Retail and Healthcare. Star is at the forefront of POS and mPOS solutions. Together with The POS Company, Star are able to offer adaptable solutions to meet the needs of the retailer.
High card / Reduced cash payments – Retailers who take the majority of payment via card should look to Stars all-new mPOP which is a combined Bluetooth cash drawer and 2” Receipt printer. Designed for card payment the mPOP is compatible with all major mobile operating systems giving retailers the freedom to use the platform that works for them. Effective cable management means no more tangled wires, and available in black or white for an aesthetically pleasing design to match any retail space.
Future Connectivity- Star’s TSP654BI & HI X Connect interface offers Intelligent printing for modern Cloud printing. The HI X Connect interface offers a variety of connectivity options and offers retailer’s sustainability by fulfilling today’s needs whilst offering future connectivity options when they are ready to upgrade, without the need to purchase new hardware. Alternatively the HI X Connect interface can be purchased separately to offer an instant connectivity upgrade for the TSP743II, TSP847II & FVP10.
On the move – Ideal for in-store queue busting or field based payments for those Pop-Up shops, Star’s new SM-L200 & SM-S230i 2” mobile printers offer merchant’s affordable and reliable printing. Both models offer easier Bluetooth pairing with the tablet or mobile device of choice. The SM-S230i features auto detect pairing and auto reconnect functionality and is the lightest in Star’s mobile printer range at just 217g (including battery). The SM-L200 provides a mobile label printing solution as well as Bluetooth 4.0 connectivity.
For further information on any of Star Micronics printers in The Netherlands, visit www.theposcompany.nl or contact the team on +31 736481481
Source – DNB Working Paper on behalf of the DeNederlandscheBank – April 2015