As the UK retail and hospitality sectors gear up for the critical ‘Golden Quarter’, new research from Lloyds Merchant Services has illuminated the shifting priorities of businesses and consumers alike. With the 2025 holiday shopping season approaching, the focus has firmly shifted to the checkout experience, where speed, flexibility, and trust are emerging as the decisive factors for success.
According to the research, 60 per cent of hospitality businesses identify speed as their primary motivation for investing in smarter point-of-sale (POS) systems. This statistic underscores a broader trend across the industry: as festive trading volume ramps up, the ability to process transactions efficiently is no longer just a convenience but a critical operational necessity. From bustling restaurants to busy retail counters, upgrading checkout technology to handle higher footfall and reduce wait times is seen as essential to maintaining customer satisfaction and securing sales during these peak periods.
Evolving consumer expectations
The drive for smarter technology is being propelled by evolving consumer expectations. Shoppers today are looking for more than just a quick transaction; they want flexibility and security. The Lloyds research highlights that one in 10 UK shoppers have utilised POS finance to spread the cost of higher-value purchases. Furthermore, 61 per cent of Buy Now, Pay Later (BNPL) users indicated they are more likely to shop at locations that offer these flexible payment options.
This demand represents a significant opportunity for merchants. Interestingly, the research reveals a strong appetite among businesses to meet this need, provided the solution comes from a trusted source. Ninety per cent of merchants who do not currently offer POS finance stated they would be willing to do so if the solution were backed by a regulated bank. This highlights a growing preference for responsible, bank-led financial solutions that integrate seamlessly into the in-store experience.
Melinda Roylett, managing director of merchant services at Lloyds Banking Group, commented: “This year’s holiday season will be defined not just by what people buy, but how they choose to pay. Whether dining out, shopping on the high street or booking festive experiences, customers expect payment to be fast, seamless and trustworthy. Investment in modern POS technology and responsible finance is helping businesses deliver faster, more reliable checkout experiences that build customer trust.”
The hospitality challenge
For the hospitality sector specifically, payment speed and reliability are paramount. The research found that 77 per cent of hospitality businesses cite contactless as their most requested payment method. However, challenges remain, with 42 per cent of businesses highlighting slow transaction processing as a key operational hurdle.
With many merchants anticipating stronger trading during the festive season, there is a clear push to look beyond basic card acceptance. Retailers are modernising their payment infrastructure to include integrated POS and finance solutions that improve checkout flow and support higher-value purchases.
Preparing for the Golden Quarter
To help businesses navigate the pressures of the peak season, Lloyds Merchant Services has outlined three key areas of focus:
- Optimise the checkout experience: Ensuring POS systems can handle high footfall and diverse payment types—including mobile wallets and instalment options—is vital to avoiding friction at the point of sale.
- Improve cashflow visibility: Faster settlements and integrated reporting tools allow businesses to track performance in real-time, enabling them to reinvest quickly during periods of high demand.
- Strengthen fraud protections: With fraud losses in the UK exceeding £1.17billion in 2024, businesses are urged to layer POS security with responsible finance options to protect both revenue and reputation.
Roylett added: “For many retailers and hospitality businesses, the holiday period brings opportunity and pressure in equal measure. The difference between winning and losing a customer can be how seamless the experience is or whether instalment options are available when budgets are stretched.”
By investing in proven systems and responsible lending options now, businesses can enter the busiest time of the year with the confidence and control needed to thrive.
