Debit card payments overtook cash payments for the first time in 2017, says a recent report from UK Finance, a trade association that represents the UK finance and banking industry. And almost two thirds of Britons now use contactless payments, with the number of transactions increasing by an amazing 97% during 2017 to 5.6 billion.

Are you ready to respond by offering cashless and contactless payments in your salon or barbershop?

This blog post covers:

Merchant accounts

To accept payments by card, you will need a merchant account. This works as a link between your card machine and your bank account. Payments will be go into your account by BACS typically within three working days. Ask your bank for advice but also shop around to compare transaction costsFind out more about choosing the best bank account for you.

Card payment

Choose a card machine

For the majority of salon and barbershops businesses the most cost-effective option is to rent a card machine. NHF Trade Member Global Payments offers NHF Members preferential rates, plus no sign-up fees and no hire fees for the first three months.

You can select a fixed or portable card payment machine.

Contactless payments

Contactless payments are a fast and secure way to make payments, usually of £30 or under.

There is no need for a pin number or a signature – the person paying simply taps their card on or near the pay terminal and the money is transferred. This is sometimes referred to as ‘tap and go’.

Contactless payments can also be made without credit or debit cards by using systems such as Apple Pay, Android Pay and Google Wallet via mobile devices. Payments of over £30 can be made using these systems, but additional security is required such as a PIN or fingerprint.

The fees for processing contactless payments are the same as for chip and pin methods, so you won’t be left out of pocket. Payments are processed through the same secure networks.

Guide to card payments

 Our comprehensive guide to the financial aspects of running a small business is available free to NHF Members.

 

A useful option

Contactless payments are especially valuable for barbershops where payments of under £30 are common. They allow the client to pay in seconds, reducing queues at peak times.

They’re also fast and convenient for hair and beauty salon clients who want to buy retail products or pay for lower-cost services such as manicures.

Barber shop pole

How to offer contactless payments 

You will need a payment terminal that accepts contactless payments via near-field communication (NFC technology). Two-in-one models are available that accept both contactless and traditional chip and pin payment methods. 

Speak to your payment terminal provider to find out more. Also, add a date to your diary: your card payment machine must be able to accept contactless payments by January 2020.

Guide to finance

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Keep the cash …

However, don’t ditch cash payments just yet. UK Finance says cash will still be the second most frequently used payment method in the UK by 2027 – so it’s unlikely that the UK will become a cashless society in the near future.

The best advice is to offer a range of payment methods so your clients can pay in the way that suits them best.

Guide to prices, wages and profits

 

This guide will help you understand the basics of financial management for your business including tax, VAT, accounting and record keeping. It’s available to NHF Members only. Not yet a Member? Join today.

What the law says

Since January 2018, it has been against the law to charge your clients extra for paying by credit card, debit card or via methods such as PayPal. This means you have to absorb the costs of offering card payment. Alternatively, you can:

• Increase your prices to help cover the cost (these prices must apply to all clients whichever payment method they use).

card payment terminal
• Negotiate lower fees with your financial services provider.

Checklist

• Debit and contactless payments are increasingly popular.
• Cash will remain an important method of payment for a good while yet.
• You’ll need a merchant account to accept card payments.
• Hiring a payment machine is the most cost-effective option.
• Ask your provider about accepting contactless payments.
• The law says you can’t charge your clients extra for paying by credit card or debit card.
• Offer a range of payment methods to meet all your clients’ needs.

More from the NHF

Bookmark our website to make sure you’re up to date with all the latest news, views, information and advice relating to the hair, beauty and barbering industry.

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• Starting up
• Salon software
• Apprenticeships
• Pensions

Read our brilliant blog posts to gain expert business insights into key hair, beauty and barbering issues, including:

Business banking and cash flow forecasts

Health & safety and public liability insurance

National Minimum Wage and recruiting the right team

Social media and building a business website

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