UK SMEs are losing billions in sales each year due to consumer mistrust of manual bank transfers, according to new economic analysis from Tink, an open banking and payments platform, and the Centre for Economics and Business Research (Cebr). The analysis estimates that this ‘fear of fraud’ cost UK SMEs a staggering £6.15 billion in the last financial year.
Lack of trust
The study, which surveyed 2,000 UK consumers and 500 SME leaders, found that 41% of consumers would abandon a transaction if asked to manually transfer money into a personal bank account. A further 57% said they don’t trust businesses that request payment this way.
Manual bank transfers remain common among SMEs, particularly for deposits on services such as building work or medical appointments. In the online retail space, they may be used for cross-border, B2B or wholesale transactions, or by niche retailers with limited access to payment gateways. A staggering 87% of SMEs that accept manual transfers still rely on them regularly, despite lack of consumer trust – a lack of trust that is translating into significant financial losses. The study estimates that £6.15 billion in sales were lost in the last financial year due to consumers walking away from purchases over payment concerns. The indirect cost is even higher, with £31.4 billion in potential lost customer loyalty and repeat business attributed to outdated payment methods.
What this means for digital-first businesses
For digital-first businesses, the implications are especially stark. These companies rely heavily on seamless, trust-based online transactions to drive growth. In a competitive ecommerce landscape, friction at checkout – especially around payment security – can be catastrophic to sales. With 81% of consumers saying payment options influence their decision to buy, secure, flexible payment experiences are a must-have for online retailers.
“Manual bank transfers are often no longer fit for purpose and are holding the UK economy back,” said Ian Morrin, head of payments at Tink. “Whether it’s covering medical bills or making an upfront payment for a high-ticket item like a new car, consumers are uncomfortable being asked to send money without the reassurance of a trusted payment provider.”
Morrin added: “These methods can create friction, fuel fraud fears, and ultimately erode customer trust. In today’s landscape, where trust and choice are non-negotiable at checkout, businesses can’t afford to rely on outdated payment methods that cost them both sales and loyalty.”
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