Processing cash payments cost UK retailers an average of £17.8bn per year or £3,638.57 per retailer, according to a research by payment service provider Sage Pay.

The survey, which questioned 1,124 UK business decision-makers and 1,042 consumers, found that 31% of consumers were willing to shop at stores that offer wide range of payment modes, whereas 80% of businesses were willing to adopt new payment methods such as contactless payments, payment apps or bitcoin only if requested by customers.

The survey also found that 63% businesses were yet to integrate their online and offline channels through an omnichannel solution, as over 50% of consumers wanted to use more than one channel when making a purchase.

A new report, The Payments Landscape 2014, released by Sage Pay stated that UK SMBs need to increase their adoption of new payment methods or risk losing out on new business.

The research saw 40% of businesses losing money due to fraud, while 39% of surveyed retailers did not spend anything to prevent fraud.

Sage Pay CEO Simon Black said UK SMBs are a driving force in the UK economy, but if they fail to innovate, they are in danger of being left behind.

"Reducing friction should be the focus for every business. Whether that’s looking at moving away from cash towards newer payment types, using ‘single-click’ checkout or adopting an omnichannel approach, this report looks at payments in the context of the consumers and businesses that use them," Black added.