Mind the Gap: How payments providers can fill a banking gap for online merchants - Banking Circle White Paper

Report, published: May 2020

Payments providers can fill the banking gap for online merchants

The world of online trading is a rapidly growing marketplace; but it is also a marketplace where entrants face multiple barriers to operate because established financial institutions have a fear of the unknown. 

In 2018 Banking Circle spoke to 500 UK SMEs trading online to find out the difficulties they face with payments and borrowing. Two years on, the research has been repeated and expanded, to gain a deeper understanding of how the landscape for access to payment services and funding is changing. The latest study included 1,500+ SME merchants from across Europe, to provide a wider regional picture.

Interviews with selected payments providers complement the survey results, providing exclusive insights into how organisations are changing their propositions to address the challenges their online merchant customers face.

The study found that 64.6% of online merchants have needed extra finance in the past two years (excluding the current COVID-19 crisis). 23% have needed the additional funding to cover payroll, and a further 26.5% to cover regular business costs.

Just under a quarter of respondents had to wait between three and four weeks to receive the cash they needed to cover these essential costs. 26.4% felt that without access to this cash they would be forced to let employees go, and 24.4% believed the business would ultimately fail.

‘MIND THE GAP: How payments providers can fill a banking gap for online merchants’ provides insights into the contrasting picture across different European geographies, identifying how Banks and Payments businesses can fill the gap and help SME merchants compete, grow and prosper. 

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Research Type Overview
Published 14 May 2020
Pages 43
Geographic Scope    United Kingdom
Editions Payments General