COVID-19 has changed how Canadians spend at small businesses: sales remain low
One in three small business owners report they have increased their use of credit cards and Interac e-transfer as a method of getting and making payments
TORONTO — New data shows payment methods at small businesses have shifted away from cash toward electronic options like credit, debit and Interac e-Transfer.
Despite this shift, sales remain low for this time of year, according to the latest data on the Canadian Federation of Independent Business (CFIB)’s Small Business Recovery Dashboard, part of its #SmallBusinessEveryDay campaign.
Small business recovery ticked up slightly with 62% of small businesses fully open (58% last week), 37% fully staffed (35% last week), and 26% making normal sales (24% last week). Additional data from Chase Merchant Services shows credit and debit card sales for Canadian small businesses are on average 25% lower for March-June 2020 than the same time in 2019. Monthly credit and debit sales have improved since lows seen earlier this year in April when more businesses were closed (April was 40% lower, May was 25% lower and June was 15% lower than in 2019).
“While consumer spending through credit and debit seems to be improving, the broader picture shows that there has been a shift in payment methods and sales remain at perilous levels for many businesses,” said Corinne Pohlmann, senior vice-president at CFIB, in a prepared statement.
One in three small business owners report they have increased their use of credit cards and Interac e-transfer as a method of getting and making payments, and one in four have increased their use of debit cards, while 38% have decreased their use of cash since the pandemic started and seven per cent have stopped using cash altogether.
“Things are slowly getting better, but small businesses depend on Canadians to choose local so the hardware store down the street, the independent pet shop, the mom and pop bakery can survive” continued Pohlmann.