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A reliance on outdated payment methods is costing small businesses across Britain dearly as consumers develop a fear of fraud.
Fear of fraud costs UK SMEs billions
New analysis from Tink and the Centre for Economics and Business Research (Cebr) estimates that UK SMEs lost out on £6.15 billion in sales last year due to consumer mistrust of manual bank transfers.
Manual transfers, where customers are asked to send funds directly into a personal or business account, remain common for deposits on services such as construction work, medical appointments, or high-value purchases.
Yet consumer sentiment has shifted dramatically.
Tink’s survey of 2,000 UK consumers found that 41% would abandon a transaction entirely if asked to pay this way, while 57% said they do not trust businesses that request it.
These fears are not unfounded.
The UK Finance Fraud Report recorded £450 million in losses from Authorised Push Payment (APP) scams in 2024, reinforcing consumer reluctance to rely on direct transfers.
More than two-thirds (67%) of consumers worry about inadvertently paying a fraudster, and 86% say they feel uneasy if the bank account name does not match the business they are paying.
A £31.4 billion loyalty problem
The impact extends beyond immediate sales.
Cebr’s modelling suggests an additional £31.4 billion in potential annual losses linked to reduced customer loyalty.
When consumers associate a business with insecure payment practices, they are less likely to return, undermining long-term relationships that are vital for SMEs.
Given that small and medium-sized enterprises account for 99.9% of UK businesses, the economic implications are significant.
Trust and choice at checkout
Payment experience is increasingly central to consumer decision-making. Four in five consumers (81%) say the methods available at checkout influence whether they complete a purchase.
Two-thirds (66%) distrust businesses that do not partner with a recognised third-party payment provider, while 84% expect multiple payment options as a baseline.
This makes trust, security, and flexibility non-negotiable.
Outdated practices such as manual transfers no longer meet consumer expectations and, as the figures show, are actively damaging revenues.
Moving towards secure alternatives
Tink argues that businesses should adopt modern, secure payment options such as Pay by Bank, digital wallets, or card payments to restore confidence and protect revenue streams.
Ian Morrin, Head of Payments at Tink, warned that manual transfers are “holding the UK economy back” and urged businesses to embrace methods that reduce fraud risks while improving conversion rates.
For SMEs already facing economic headwinds, the message is clear: payments are no longer just a back-office function. They are a frontline factor in building trust, securing sales, and sustaining customer loyalty.
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