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Cashless technology has revolutionised the way businesses operate in the UK. Our cashless society has brought many benefits to companies and customers, including increased efficiency, reduced costs, and enhanced security. However, it also brings a range of legal issues that businesses must carefully consider. This article will explore the legal issues your business should consider when using cashless technology in the UK.
1. Data Protection and Privacy
Businesses must consider data protection and privacy a critical legal issue when using cashless technology. When customers use cashless payment methods, their personal and financial data is collected and processed by your business. This data includes their:
- name;
- address;
- email address; and
- credit card details.
Under the General Data Protection Regulation (GDPR), businesses must ensure that the personal data they collect is processed lawfully, fairly, and transparently. This means that companies must inform customers about the type of data they collect and the purposes for which it will be used. They must also obtain explicit customer consent to process their data.
In addition to the GDPR, businesses must comply with the Payment Card Industry Data Security Standards (PCI DSS). These standards set out requirements for companies that process credit card payments to ensure customer data is secure and protected from fraud.
Your company must implement appropriate data protection and privacy policies and procedures to comply with these regulations. This includes:
- ensuring customer data is stored securely;
- enforcing access controls; and
- conducting regular risk assessments and audits.
2. Consumer Protection
Another legal issue to consider when using cashless technology is consumer protection. Digital payments are often made using credit or debit cards, and consumers are protected by various laws and regulations when using these payment methods.
The Consumer Rights Act 2015 sets out a range of rights consumers have when making purchases, including the right to a refund or replacement if goods are faulty or not as described. Additionally, the Consumer Credit Act 1974 further protects credit card purchasers.
To comply with these regulations, your company must ensure that it provides clear and transparent information to customers about the terms and conditions of its payment services.
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3. Contractual Issues
Cashless payments often involve contractual relationships between businesses and payment service providers. These contracts set out the terms and conditions of the payment services provided, including:
- fees;
- liability for fraud; and
- dispute resolution processes.
To ensure these contracts are enforceable, businesses must ensure they are compatible with the requirements of the Contracts (Rights of Third Parties) Act 1999. In addition, most companies obtain expert legal advice to ensure the contract’s wording protects their legal position.
Your company also needs to consider the terms and conditions of the contracts it enters into with customers when offering cashless payment services. These contracts should include provisions compliant with relevant laws and regulations, such as consumer protection and data protection laws.
4. Accessibility Issues
Additionally, your business should consider accessibility issues when offering cashless payment services. While cashless payments can bring many benefits, they can also create barriers for people who lack access to the necessary technology or are uncomfortable using it.
Under the Equality Act 2010, UK organisations must ensure their services are accessible to all customers, including those with disabilities and older consumers. This includes ensuring all consumers can access cashless payment services and alternative payment options.
Your company should ensure that its payment systems are designed to be accessible to a broad range of potential consumers and that alternative payment options are available for customers who cannot use cashless payment methods.
5. Taxation Issues
Electronic payments can also raise taxation issues for businesses. Under UK tax law, companies must keep accurate records of their financial transactions, including cashless payments. This is to ensure that companies pay the correct amount of tax on their income.
In addition, businesses may also be subject to VAT on contactless payments and must ensure it complies with relevant VAT regulations.
Key Takeaways
Cashless transactions have brought many benefits to businesses in the UK, including increased efficiency, reduced costs, and enhanced security. First, however, your company must understand and act upon data and privacy issues, consumer protection laws, contractual issues, accessibility issues and taxation issues. By addressing these matters proactively, your company can take advantage of cashless technology while meeting its legal and regulatory obligations.
If you need help lawfully utilising cashless technology, our experienced e-commerce and online business lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
Frequently Asked Questions
Some customers still favour cash transactions because it can help budgeting and cash management, as well as physical money providing better privacy.
No, many UK companies recognise that some categories of society (such as older people) prefer using physical cash within physical premises, so they allow this payment.
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