General / Regulation / 05 June 2018

BBPA responds to the cash and digital payments consultation

The British Beer and Pub Association (BBPA) has today responded to the Treasury’s consultation on cash and digital payments in the new economy.

Whilst the BBPA has acknowledged the growing trend towards digital payments in its response, it has cautioned the Government’s involvement in the payments market as unintended consequences for cash-based businesses are still being felt.

As an example of this, the BBPA has highlighted the recent implementation of the EU Payment Services Directive, which only recently came into force in January 2018. Since its implementation, the Directive has meant that many pubs now require a minimum spend to help offset the cost of providing digital payment services to their customers, without directly passing the cost on to them through higher prices. 

The BBPA has noted that this disproportionately effects the local pub that wants to offer convenient services to attract customers, without having to raise prices and risk losing business. The cost of offering a digital payment service can be as much as 20p per use to the publican and as the average cost of a pint in the UK is £3.39 for beer and £3.05 for cask ale (or 5.9% and 6.6%, respectively, of a pint), many pubs must set a minimum spend on digital payments to ensure they don’t cut too deep into their already squeezed margins. 

Finally, the BBPA has reminded the Treasury in its response to the consultation that cash-based entertainment options ranging from betting machines to snooker tables form an important part of a pub’s offer. Should the Government continue to legislate around digital payments, the BBPA would encourage them to look at accepting digital payments for entertainment options like these. Keeping two distinct systems is costly and punitive to business and discriminatory to customers.  

BBPA Chief Executive Brigid Simmonds comments:

“A shift towards digital payments across the world of commerce is clearly taking place. Whilst this can be good for busy pubs where payments at the bar are much faster for customers, Government intervention towards such innovation needs to be well thought through. If not, cash-based businesses such as pubs could be unfairly burdened. In due course, it would be good to see an increase in the maximum limit for contactless payments from £30 to £50.”

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