Here are the week’s main news stories in the world of small business and e-payments:
Sweden number one for cashless payments
Sweden is leading the way in the march towards a near-cashless society. During 2016, people in Sweden made an average of 461.5 digital transactions, a 13 per cent increase in just one year, according to the annual World Payments Report from Capgemini and BNP Paribas. The report said the key factor in Sweden’s growth in digital payments is a range of initiatives taken by the country to facilitate and support a cashless society. This includes online payment apps, such as Swish, used by 6.33 million people in Sweden. The US was in second place, with the number of non-cash payments increasing by 5.2 per cent over the same period, to reach an average of 459.6 digital transactions. South Korea came third in the ranking, followed by Finland and Australia.
Small businesses gain access to Financial Ombudsman Service
Small businesses will be able to lodge complaints against banks and secure compensation through the Financial Ombudsman Service (FOS) from next April, after calls for stronger regulation of business banking. The Financial Conduct Authority said businesses with an annual turnover of less than £6.5m and fewer than 50 employees, or an annual balance sheet smaller than £5m, would be able to use the service, which currently provides rulings only for individuals and micro-businesses. It also announced a new consultation to look into raising the maximum amount of compensation the FOS can force firms to pay from £150,000 to £350,000.
Three quarters of SME owners struggle with mental health
SME owners are struggling with their mental health, according to new research. Haines Watts chartered accountants found that 73 per cent of respondents surveyed feel that being a business owner was having a negative impact on their mental health, yet only four per cent of this group have sought medical help for this. The survey of 500 SMEs in the UK also found that 73 per cent of business owners have never taken more than a week of holiday. Haines Watts suggested that the reasons for business owners not seeking help with their mental health is because of the possible taboo around the subject, as well as 47 per cent of respondents feeling like no one, even a specialist, could ever understand the level of pressure they are under.
Walmart and PayPal collaborate on payment
Walmart, the world’s biggest retailer, and PayPal have announced a partnership which will see the two collaborating on financial services. It will include the new PayPal cash in and cash out services, as well as the option for PayPal Cash MasterCard customers to access cash balance in-store at service desks. With the partnership, Walmart customers can go into a store, access cash from PayPal and make purchases. It is the first instance in which PayPal mobile app users can take out cash from their PayPal balance in a brick and mortar store.
SMEs struggling for right digital talent
Four out of five SMEs are struggling to attract the skills they need to adapt to digitalisation, according to recruitment agency Robert Half. As a result, many small businesses are being forced to offer salary packages higher than originally intended to compete for talent. Seven out of 10 businesses are paying more than they planned to secure the right candidate and 53 per cent admit they can’t find candidates with the right skills to help them navigate an increasingly digitised business world. SMEs lag behind larger companies when it comes to offering training – a key factor in retaining employees. More than three-quarters (76 per cent) of SMEs said staff wanted to leave if companies could not provide them with training.
Klarna to build payment services for H&M
Klarna, the Swedish payments startup that helps online shoppers arrange for financing at the point of sale, has secured $20m in funding from fashion retailer H&M. The investment is the start of a partnership between the companies to build an omnichannel payments service spanning H&M’s physical and online storefronts. The deal will cover ‘frictionless’ in-store, mobile and online payments across the company’s whole footprint, a better delivery and return process, and more flexible payment options, including ‘try before you buy’ pay later services, to be delivered through H&M’s app and its loyalty programme. The first phase of the partnership will go live in 2019 in H&M’s home market of Sweden before a global roll-out.