Issue link: https://maltatoday.uberflip.com/i/1176246
2 maltatoday | SUNDAY • 13 OCTOBER 2019 NEWS KARL AZZOPARDI COSTS borne by businesses to accept card payments are too overbearing, fostering a nega- tive attitude towards cashless payments, the director of small business chamber GRTU, Abi- gail Mamo, has said. Eight branches of HSBC Bank Malta will be shuttered in a cost- cutting exercise that was greet- ed with some outrage by elderly residents who do not make use of the bank's digital online sys- tem. The bank has insisted that the closures reflect more invest- ment in digital capabilities for customers. But a GRTU study issued in September reveals that a third of Maltese shops still do not accept card payments, a real- ity that makes the prevalence of cash in the hands of those who do not use cashless and contact- less payments, all the more vital – especially for elderly clients who do not use cards or even contactless solutions such as Revolut and its integration into smartphones. Asked why such a large portion of businesses still don't accept card payments, Mamo said that the percentage that goes out of card payment for the service is a big dig at their profit margins and they refute this. The study, commissioned by Mastercard and the GRTU, and conducted by Grant Thornton, found that 40% of the Maltese's total expenditure was affected in cash. Those who refused to allow card payments mentioned additional costs as the reason, with 53% saying they would con- sider integrating new payment solutions in the near future. "Why should the banks have a piece of the cake every time a sale is made, based on the size of the transaction?" Mamo asked. With businesses citing addi- tional costs when refusing card payments, Mamo was asked how these charges can be over- come. "I'd like to say that costs not only can, but will be over- come, through competition. It's a matter of time and business confidence." Mamo thinks new market en- trants are intent on challenging the status quo and there is a healthy momentum picking up. "A stronger effort from the country's banking sector to be innovative and excel in custom- er service through technological advancements is required. This, however, should translate in an increase in service, not a step back, and that is what we see as a priority. GRTU knows its mem- bers and the absolute majority appreciate the direct profession- al relationship, something the banking sector has been steadily moving away from for different reasons," she said. Mamo also said cash transac- tions can have negative impacts on businesses. "It exposes busi- nesses to risks and is a less ef- ficient system," she said. "With the safety and security that electronic payments have, these systems should become a re- quirement rather than a choice for local businesses. As things stand, we do not believe that imposing payment conditions is fair because the market condi- tions themselves are not fair." Mamo says new contactless payments – such as Revolut cards integrated into smart- phones – are on the rise, and would surely move consumers to using cards more and there- fore business will follow. "The GRTU is making mem- bers aware of the new oppor- tunities, and we're encouraging them to pursue. We are also in advanced discussions on ad- dressing bottlenecks from an incentive perspective," Mamo said. Bormla pensioners vent their frustration at HSBC's branch closure https://bit.ly/32egdXi Future's cashless, but shops still don't do plastic The closure of eight HSBC branches has riled elderly clients, but if more shops accepted contactless payments, the need for cash could be easily surmounted