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How Retailers Can Take Payments

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Last editedJan 20222 min read

Retail is a very broad sector. It covers everything from tiny, real-world pop-up stalls to massive ecommerce giants. Similarly, purchases can value under a pound to many thousands of pounds. They can be one-off or recurring. Fortunately, there are payment solutions for every type of retail business. Here is a quick guide to the main ones.


Cash was falling out of favour long before COVID-19. It has security issues and hygiene issues. It’s also vulnerable to human error (e.g. giving the wrong change). It needs to be counted manually, deposited physically and accounted for without the help of automated reconciliation.

Given all these drawbacks, it’s hardly a surprise that cash looks unlikely to regain its crown as the UK’s preferred payment method. With that said, it’s still popular amongst some demographics, particularly older people. Some retail businesses may, therefore, find that it’s still worth accepting.


Cheques have all the drawbacks of cash plus lengthy clearing times. Even businesses that still take cash now increasingly refuse to take cheques. Like cash, however, cheques are still popular with some demographics. Again, this tends to be with older people who use them for higher-value transactions. This means that some retail businesses may find they are worth accepting.


Cryptocurrency is basically digital cash. It has much the same security issues as regular cash although it is more hygienic. Cryptocurrency can be used in the real world but, as yet, it has not gained any real hold. It’s more popular online but even here it’s niche. 

Cryptocurrency might be useful for retailers with an international customer base. It can be an economical way to process cross-border transactions. With that said, so are direct debits and they have much wider adoption amongst consumers.


Ewallets started out as being online-only forms of payment. They are now moving into real-world payments but adoption is still fairly low. Ewallets often offer a very straightforward route to taking payments. 

They are, however, often very expensive. This is because they tend to rely on other payment services, such as direct debits and payment cards. The fees for these need to be included in the fees charged by the ewallet providers.

Direct debit

Up until recently, direct debit had limited use in retail. It tended to be limited to retailers which could support in-house instalment plans. Open banking has changed that. Firstly, it allows retailers to partner with buy-now-pay-later services. This gives even smaller retailers a straightforward route to offering instalment payments.

Secondly, open banking has made it possible for retailers to use the direct debit network for instant payments. In other words, direct debits can now be used in much the same way as payment cards (and indeed cash).

As a further point, direct debits have long been the payment method of choice for recurring payments. Increasing numbers of retailers are now working to move away from focusing purely on one-off sales. 

For example, they are allowing customers to set up recurring orders of goods they use regularly (e.g. cleaning products and staple foods). They are also offering subscription box services that allow customers to try out new products in an affordable way. Direct debits are often ideal for these business models (and many more).

Direct debits are also becoming increasingly popular with retailers which work internationally. The transaction fees tend to be lower than for ewallets and payment cards. They may be higher than for cryptocurrency but direct debit offers much greater security and a much higher level of consumer adoption.

Payment cards

Payment cards have long been the default option for retailers, especially in the real world. They are fast, convenient, secure and widely adopted. The main problem with them is the fees. Credit card payment solutions for retailers are particularly expensive. In the UK, retailers can deal with this by applying surcharges. This approach can, however, create friction with consumers.

Mobile payments

Mobile payments are very similar to ewallets. The only real difference between them is that they are installed on the user’s mobile phone. They can be very convenient but accepting them may involve high up-front costs as well as high fees.

We can help

If you’re interested in finding out more about payments for your retail business, then get in touch with our financial experts. Find out how GoCardless can help you with ad hoc payments or recurring payments.

Over 85,000 businesses use GoCardless to get paid on time. Learn more about how you can improve payment processing at your business today.

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Interested in automating the way you get paid? GoCardless can help
Interested in automating the way you get paid? GoCardless can help

Interested in automating the way you get paid? GoCardless can help

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