Spar To Start Taking Contactless Payments

S6 528: Edward VIII, Law Bros Petrol Station, PO & Spar shop, Sheffield, S6 1LR

Hot on the heels of motorway restaurant Little Chef starting to offer contactless payments, supermarket Spar is now investing £700,000 installing the contactless equipment to its 2,600 stores.

The Register reports that they’re willing to make this investment as they’ll be able to recoup it from the reduced transaction costs that contactless payments have over traditional card payments:

Visa charges as little as a penny for a transaction worth under £2 if it’s completed wirelessly (using contactless tech). Less than a tenner and the cost is only 4p, compared to 8p for a chip and pin-secured transaction.

They’re also keen on reducing the amount of cash that they have to look after each night:

It’s all strategy about how to have a minimum of cash in the business at the end of the day, thereby reducing the security issue. If all my transactions that currently are (conventional) debit were to move to contactless (debit), then my return on investment is under 18 months.

The problem is still that there’s only really Barclays who are issuing cards with the necessary technology in, so few customers can actually pay in that way.

Tipping Point?

Are we starting to see the contactless payment tipping point?

OK, so Spar and Little Chef aren’t exactly the biggest nor innovative of companies, but Co-op are also to start trialling contactless technology in 100 of their stores, with a view to rolling it out to their 2,500 by the time of the London Olympics in 2012. So the number of stores offering it as a payment method is quietly increasing. With each retailer coming on board there will be a greater incentive for the banks to issue contactless cards.

But I wonder whether the success of contactless payments lies more with the use of mobiles than with cards issued by the banks, though? I’d be surprised if those kinds of development weren’t already in the pipeline.

Creative Commons License photo credit: Post Box

Leave a Comment

Your email address will not be published. Required fields are marked *