Do you take credit and debit cards yet? It doesn't take a razor-sharp mind to work out that the small independent retail sector is one of the last bastions of the cash-only transaction. When the average spend is, say, £2.50, then plastic can prove too costly. You will be pleased to hear then that, officially, cash is still king among consumers with credit cards in the ascendant and cheque transactions in decline. The latest statistics from the Association of Payment Clearing Services (APACS) show that consumers spent £260bn in cash in 2001, which was around 50% more than was spent on personal credit and debit cards combined. Over one-quarter of adults still make all of their retail purchases by cash and this rises to more than 90% of payments made at off licences and over 95% of payments made at newsagents and small convenience stores. This figure has remained stable in real terms for several years, but APACS points out that one major factor that will alter this pattern is the introduction of automated crediting for all state benefits. Those who previously received their benefits in cash over a post office counter may make fewer cash payments once the benefits are paid directly into a bank account. It is forecast that cash will account for 62% of all payments in 2010 compared to 73% in 2001. Meanwhile cheque transactions fell by five per cent last year, a similar rate of decline to that seen in 2000. It is forecast that the volume of cheque transactions will fall from 2.6 billion in 2001 to 1.6 billion by 2010. That brings us to the rising stars, credit and debit. Over 55% of adults now hold one or more credit cards and only a small number of current account holders do not have access to a debit card facility. In fact nearly 60% of adults are regular debit card users. Plastic cards are expected to remain the fastest-growing non-cash payment method. The trends are obvious so this would be a good time to look at the various multi-functional options in the market that will allow you to get in on the act in a cost-effective way. There are companies like PayPoint and PayZone that handle utilities transactions and companies like PT Distribution, E-Vita and Epay which provide electronic mobile phone top-ups and terminals supplied by banks such as Barclays Merchant Services and NatWest's Streamline for credit and debit card transactions. The technology that makes all these terminals work is one and the same which is why all these companies are working towards being all things to all retailers. Some of them, such as PayPoint, already supply terminals that can be used for all the functions listed above. So with just one terminal on your counter and one phone line ­ and therefore fewer charges ­ and with some of these services paying commission (not huge, not even decent, but detectable), then it could really be worth taking plastic. If you are strapped for space, you could offer cash-back as opposed to installing an ATM machine. And remember, people also spend more when they can use plastic. {{GROCER CLUB }}

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