Author

Swati Deshpande

Published

11 September 2026

Estimated Read time

5Mins

Swati Deshpande, Marketing Manager at URocked, on how digital payments bring clearer records, faster reconciliation and far less manual intervention across finance and payroll

Cash now accounts for less than 10% of payments in the UK and is expected to fall below 4% over time. As transactions move almost entirely through digital channels, the way money flows through businesses is becoming more structured, more visible and more demanding to manage.

In sectors like hospitality, which are already dealing with rising costs and tight margins, businesses continue to absorb pressure from business rates alongside the removal of pandemic-era support. As a result, this leaves very little room for inefficiencies in day-to-day operations, especially as they directly affect customer service and employee satisfaction.

Tipping, once informal and largely self-managed, now sits firmly inside those operations.

From direct exchange to recorded transaction

For years, tips were exchanged directly between customers and staff, most often in cash. They were immediate, visible and largely outside formal business systems.

That has changed as customers increasingly pay by card or mobile. Tips are now added to the bill and processed as part of the overall transaction. They pass through payment infrastructure, are captured in financial records and become part of the data businesses must manage.

The Employment (Allocation of Tips) Act has further increased employer responsibilities. From 1 October 2024, businesses have been required to pass on 100% of tips to staff and maintain clear records showing how those payments are allocated.

However, research into how businesses have responded to the Tipping Act shows that implementation remains uneven. One in four employers reports making no changes to how they handle tips since the legislation came into effect. A further 26% say they have struggled to understand how it should be applied in practice. There are also gaps in awareness – only 53% of employers know that all tips must be passed on to staff.

Digital transactions leave a clear audit trail, which makes inconsistencies more visible. With all payments now recorded, the informal approach that once relied on trust is harder to maintain when every transaction is logged. However, where processes are unclear or inconsistent, businesses struggle with compliance and admin overload.

The hidden workload behind micro-payments

The individual value of a tip may be small, but the number of transactions accumulates quite quickly. A busy venue can generate hundreds of tips in a single day. Multiply that by different locations, and that becomes thousands of individual payments every single month. Each of those payments must be separated from revenue, recorded and reconciled before distribution. Tips then need to be allocated across staff, often taking into account roles, hours worked or agreed distribution models.

For finance and HR teams, this creates a continuous stream of work that involves monitoring transactions, validating totals, managing allocation rules and ensuring that payments are made within the required timeframe. The process becomes even more demanding once it is scaled across a business. The more transactions there are, the greater the need for consistency and oversight, and this is where many organisations are still adjusting.

How employees experience the change

Tipping with cash used to create a direct link between the customer and the staff. Today, digital payments introduce a layer of processing between collection and distribution, essentially putting businesses in charge of the transaction. That change places greater importance on transparency. Employees need to understand how tips are calculated, when they will be paid and how allocations are determined.

The data suggests that experience is mixed. A quarter of hospitality staff say they have not noticed any change in how their employer handles tips since the law came into effect. A further 23% report receiving fewer tips. At the same time, 65% of staff rely on tips or service charges as part of their income. When processes are unclear, they influence earnings, confidence in the employer and overall job satisfaction. For businesses, if more time is spent on reconciliation and corrections, it effectively drives up operational costs in an already margin-sensitive sector.

While most respondents say the Tipping Law change has improved fairness for staff, gaps in understanding and inconsistent implementation remain widespread. Closing that gap now depends on clearer guidance, stronger transparency and processes that ensure tips are distributed accurately and consistently across the sector.

What tipping reveals about digital payments

Tipping highlights a broader pattern that applies across the service economy. As cash becomes less common, every payment becomes part of a formal payroll system, regardless of its size. Even the smallest transactions are now expected to meet the same standards as larger payments, which increases the level of operational processes required across the business.

High volumes of small payments need to be processed accurately without errors, and processes must be robust enough to meet compliance requirements. This brings different functions closer together. Payment handling, payroll and compliance are no longer separate concerns. Decisions in one area affect the others directly, particularly when employee income depends on how payments are managed.

While digital payments have made transactions faster and more convenient for customers, some still prefer tipping with cash. Mixing cash with digital payments creates an additional unnecessary friction, which slows reconciliation and increases the risk of errors. Without a consistent digital record, discrepancies are harder to spot, and manual cash handling adds another layer of risk, from simple mistakes through to loss or theft.

Moving away from cash removes much of that complexity. Digital payments bring clearer records, faster reconciliation and far less manual intervention across finance and payroll. With the right systems in place, payments, bookings and reporting flow together, cutting down admin and giving a much clearer view of how money moves through the business while making sure those who keep customers happy are rewarded fairly.

Learn more at urocked.com

  • Digital Payments
  • Neobanking

Author

Sam Kohli

Published

18 December 2025

Estimated Read time

6Mins

Sam Kohli, CEO at PAYNT, on the need for continued innovation with biometric payments to enhance trust

For millions of people, biometric security, or the use of unique personal characteristics such as fingerprints or facial recognition to confirm a person’s identity, has become an everyday process. These technologies are now deeply integrated into a huge variety of activities. From unlocking smartphones to authorising mobile payments. It’s quick, efficient and, compared to many other methods, relatively secure.

The underlying principles are long established. Fingerprinting can be traced back to around 500 BC, when it was used on clay tablets as a form of signature. In more contemporary terms, by the 1970s and 1980s, biometric systems began appearing in government and defence environments. Although these nascent technologies were expensive and slow.

Commercial adoption only became viable in the last 30 years or so as computing power increased, when applications were focused on workplace access control rather than payments. The real breakthrough came with smartphone integration. This began with fingerprint sensors on consumer devices, such as Apple’s Touch ID and Face ID, which are now extremely popular.

A Growing Ecosystem

A quick glance at the underlying trends reveals just how rapidly the ecosystem is now expanding. According to Juniper Research, for example, by 2028, the total in-store transaction value for biometric payments is expected to reach $1.2 trillion across 46 billion biometric-enabled transactions globally. While that’s already impressive, there is still enormous growth potential.

The problem is, adoption is starting to outpace trust. A recent study published by the Identity Theft Resource Center (ITRC), revealed that while nearly 90% of respondents had been asked to provide a biometric to verify their identity in the past year, nearly two-thirds expressed serious concerns about doing so. Moreover, 39% went as far as to say that the use of biometrics should be banned for both identity verification and/or recognition.

So, what can be done to close this trust gap and help ensure biometrics are used across fintechs as a more secure alternative to passwords and PINs? One area that requires more emphasis is consent-based design. Whereby users are given clear and revocable permission regarding how their biometric data is collected, stored, and used.

In practical terms, a consent-first design could resemble a digital wallet that provides users with clear, active choices regarding the use of biometrics. During setup, biometric authentication is optional and switched off by default. The app explains what data is collected, where it is stored and how to disable it later. During the payment process, all matching occurs locally on the device, rather than in a central database, and independent certification confirms compliance with data protection standards.

These processes must also be designed so they continue to act in the best interests of users. For example, consent should be viewed as an ongoing decision, rather than a one-time formality. Users must be able to revisit and change biometric permissions at any point and without difficulty. Settings should not be buried under layers of menus and options. They should be readily available so that users understand they are in control at all times.

Biometric Authentication

For example, if a user decides they no longer want to use biometric authentication in their payment app, they should be able to switch that functionality off with a single action. In these circumstances, the app immediately reverts to PIN or password authentication, so access isn’t disrupted. At the same time, any biometric templates held on the device are securely deleted.

If the user chooses to close their account entirely, the deletion workflow should extend to all associated data, so nothing is retained unnecessarily. Users should then receive a notification that their biometric identifiers are no longer stored.

Even these relatively basic processes can help put users in a much stronger position to understand and control the use of their biometrics. And don’t forget, this isn’t just a nice-to-have; it is increasingly a regulatory requirement issued by the EU and other authorities worldwide. GDPR is a good example, as it classifies biometric data as a special category of data and prohibits processing it unless explicit consent or another lawful basis applies.

Closing the Trust Gap

Let’s be in no doubt: trust (or the lack of it) is a real problem across the payments ecosystem. Including those organisations that rely on biometrics. In many current environments, a persistent trust gap, uneven implementation and mixed user experiences show that compliance alone does not guarantee confidence. Better progress now depends on practical execution, clear communication at the point of use, and systems that make data handling visible and auditable. Collectively, these processes can help reassure people that organisations are doing the right thing consistently and for the right reasons.

As a result, transparency and education are now key to improving confidence, ensuring users understand how their biometric data is protected and how they can stay in control. For many FinTechs, this requires a shift in mindset, where transparency is seen as a core product feature, rather than an afterthought or compliance tick box. With consent first design principles in place, users should be regularly reminded about where their biometric data resides and how to delete it.

Additionally, regular external audits or certifications help demonstrate accountability and ensure FinTechs operate to recognised standards. Granted, relatively few consumers are likely to study the fine details, but the act of being credibly audited is an important contributor to the way consumers build trust.

Trust as a Competitive Advantage

In these circumstances, trust can actually evolve into a competitive advantage. Transparent payment systems and processes will always face fewer adoption barriers, fewer customer complaints and possess stronger reputational resilience in the event of incidents. Ultimately, the more open and consistent the provider, the more users adopt and stay engaged. In markets where penetration is still low, a consent-first design and a focus on trust will reassure users that they will always remain in control of their data. Encouraging increased adoption of newer, seamless payment methods.

Regardless of how you look at it, the need for change is becoming increasingly urgent. Biometric payments are evolving beyond single-factor models toward richer, multimodal processes that introduce a combination of fingerprints, facial recognition, voice patterns and behavioural signals. As these capabilities mature, they will be applied in a wider variety of payment contexts, ranging from in-store to remote authentication and open banking apps.

This will only serve to heighten expectations around transparency and user control. In this environment, consent-first design does more than support regulatory compliance; it lays the foundation for future adoption by building systems that are flexible enough to accommodate new biometric methods without compromising user trust. As consumers become more digitally savvy and accustomed to a culture where switching between service providers is relatively easy, building trust in biometrics will contribute significantly to FinTech success.

Learn more at paynt.com

  • Cybersecurity in FinTech
  • Digital Payments