CardFlight Small Business Report

March 17, 2021

One year later: 3x growth in contactless payment transactions volume during COVID-19 pandemic

Introduction

In this week’s report, we take a look at the performance of small businesses in our sample after one year of the COVID-19 pandemic.

This expanded report ranges from January 6, 2020 to March 14, 2021, beginning approximately two months before the WHO designated COVID-19 as a global pandemic on March 11, 2020 [source].

Key takeaways:

Plus: Don't miss the business outlook section, where we spotlight some business categories with the biggest gains, fastest rebounds, and more.

About the report

The CardFlight Small Business Report analyzes sales performance and emerging trends among small businesses in the United States. The first report was published on March 19, 2021.

The report has been featured in and/or cited by The Wall Street Journal, The Atlantic, Bloomberg, Business Insider, Digital Transactions, PaymentsJournal, PaymentsSource, and others.

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A year of COVID-19

Change in sales and transaction counts

First, we compare week-over-week change in sales ($) and transaction counts (#) of the small businesses in our sample from January 6, 2020 to March 8, 2021.

Transaction counts by payment type

Next, we see how the COVID-19 pandemic changed the way consumers pay for goods and services at the small businesses in our sample.

The chart below shows change in transaction volume by four payment types:

  • Invoice: Remote payment made by invoice received by email or SMS text message
  • Tapped: In-person payment made with a contactless-enabled card, phone, or watch
  • Dipped: In-person payment made with a physical card with an embedded EMV chip
  • Card on file: Remote payment made with a credit card the small business owner saved to their SwipeSimple account

Sales by business category

Next, we look at week-over-week change in sales in the following business categories from January 6, 2020 to March 8, 2021.

  • Food and Drink establishments: Includes bars and restaurants
  • Services: General contractors, healthcare providers, providers of professional services, and others
  • Retail: Businesses like sporting goods stores, specialty retail, home furnishings, and automotive


Business outlook

In this section of the report, we take a closer look at past performance and future outlook of several small business categories.

Biggest gains since March 2020

  • Clothing and Apparel: Sales hit their low point in April, 2020 (down 74%), but are now 144% above the pre-COVID baseline
  • Art and Creative Goods: Sales hit their low point in April, 2020 (down 68.7%), but are now 117% above the pre-COVID baseline


Fastest rebound after initial pandemic drop

  • Entertainment and Recreation: Sales hit their low point in April, 2020 (down 53.2%), but steadily rebounded to pre-COVID baseline
  • Healthcare: Sales hit their low point in April 2020 (down 29.9%), but are now 83.7% above pre-COVID baseline


Changes in low- and no-contact forms of payment

As seen above, the ways in which consumers pay for goods and services has changed since the start of the COVID-19 pandemic.

  • Food and Drink saw a 477% increase in contactless transactions (Apple Pay, Google Pay, and contactless card) compared to the pre-COVID baseline
  • Services saw a 150% increase in utilization of low-contact payment methods like invoices, card on file, and tapped payments combined

Last week's small business metrics

That concludes the one-year anniversary edition of the CardFlight Small Business Report.

Next, we return to the small business metrics we publish each week. To signup for email notifications for future reports, click here.

Week-over-week change in sales

This metric compares change in sales at US small businesses from the pre-COVID baseline week of March 2–8, 2020 over January 11 to March 14, 2021 (the preceding eight weeks).

Source: Transactions processed by US small businesses with SwipeSimple. Percentages provided above reflect total change over the preceding eight weeks, compared to the baseline week of March 2–8, 2020..


Transaction counts

The transaction count metric represents the total number of transactions processed by the small businesses in our sample.

Source: Transactions processed by US small businesses with SwipeSimple. Percentages provided above reflect total change over the preceding eight weeks, compared to the baseline week of March 2–8, 2020..


Change in active small businesses

This metric measures all businesses who processed at least one transaction in the preceding week.

Source: Transactions processed by US small businesses with SwipeSimple. Percentages provided above reflect total change over the preceding eight weeks, compared to the baseline week of March 2–8, 2020.


This metric shows the average number of transactions made at all of the active merchants in our sample.

Source: Transactions processed by US small businesses with SwipeSimple. Percentages provided above reflect total change over the preceding eight weeks, compared to the baseline week of March 2–8, 2020..


Card-present payments vs. card-not-present

The payments industry has two broad categories for transactions based on where they occur.

  • Card-present payments are those that are initiated in-person (face-to-face). This includes all instances in which a credit or debit card is physically swiped, inserted, or tapped at a merchant location.
  • Card-not-present payments are those made over the phone or online. This category of payments also includes invoices and those merchants who save cards of their frequent customers on file.

Changing behavior as seen through payment method

Source: Transactions processed by US small businesses with SwipeSimple. Percentages provided above reflect total change over the preceding eight weeks, compared to the baseline week of March 2–8, 2020..


Changing behavior as seen through touch-free ways to pay

The three ways US consumers typically use credit and debit cards for in-person transactions are:

  • Dipping an EMV chip card
  • Tapping a contactless card or smart phone
  • Swiping via magnetic stripe

We continue to see that overall growth in sales made via contactless payment methods are outpacing those made via EMV chip. Transactions made via contactless payment methods are now more than 296% higher than their pre-COVID baseline levels.


Changes in payment methods for in-person transactions

Source: Transactions processed by US small businesses with SwipeSimple. Percentages provided above reflect total change over the preceding eight weeks, compared to the baseline week of March 2–8, 2020..


Sales by business category

In this section of the CardFlight Small Business Report, we take a closer look at small business performance by business category.

  • Food and Drink establishments: Includes bars and restaurants
  • Services: General contractors, healthcare providers, providers of professional services, and others
  • Retail: Businesses like sporting goods stores, specialty retail, home furnishings, and automotive

Food and Drink businesses

The two charts below show change in sales and transaction counts at US small businesses in the Food and Drink category from the pre-COVID baseline week of March 2–8, 2020 over January 11 to March 14, 2021 (the preceding eight weeks).

Source: Transactions processed by US small businesses with SwipeSimple. Percentages provided above reflect total change over the preceding eight weeks, compared to the baseline week of March 2–8, 2020. .


Retail businesses

The two charts below show change in sales and transaction counts at US small businesses in the Retail category from the pre-COVID baseline week of March 2–8, 2020  over January 11 to March 14, 2021 (the preceding eight weeks).

Source: Transactions processed by US small businesses with SwipeSimple. Percentages provided above reflect total change over the preceding eight weeks, compared to the baseline week of March 2–8, 2020. .


Services businesses

The two charts below show change in sales and transaction counts at US small businesses in the Services category from the pre-COVID baseline week of March 2–8, 2020 over January 11 to March 14, 2021 (the preceding eight weeks).

Source: Transactions processed by US small businesses with SwipeSimple. Percentages provided above reflect total change over the preceding eight weeks, compared to the baseline week of March 2–8, 2020..


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Have questions, feedback, or press inquiries? Contact us. You may also view past editions of the CardFlight Small Business Report.

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About the report

The CardFlight Small Business Report is intended to provide insights into ongoing sales performance, trends, predictions, and unique analysis of US small businesses. The first CardFlight Small Business Report was published on March 19, 2020.

The report has been featured in The Wall Street Journal, The Atlantic, Bloomberg TV, Business Insider, Digital Transactions, PaymentsJournal, PaymentsSource, and others.

Methodology

The report is based on analysis of a representative sample of more than two million transactions processed by more than 70,000 small businesses who use SwipeSimple software (the signature product of CardFlight) to accept credit and debit card payments.

To create this report, we analyzed a representative sample of millions of transactions processed by:

  • in all 50 states 
  • using CardFlight’s SwipeSimple software to accept credit and debit card payments

The SwipeSimple small business owner 

The typical SwipeSimple merchant has one to ten employees and less than five locations or mobile service points. The average active merchant represented in this data set processes approximately $130,000 in credit/debit card payments annually. The merchants are a mix of professional and personal service providers, specialty retail establishments, and food and drink purveyors.