Small Businesses Embrace Payment Innovations for Holiday Sales Growth This Season

As the holiday season approaches, small businesses are poised to enhance their competitive edge in the retail market through modern payment technologies. The Electronic Transactions Association (ETA) alongside The Strawhecker Group (TSG) has released their sixth annual Consumer Holiday Spending Study, revealing that innovations in payment systems can help local merchants capture a larger share of the holiday shopping market.

According to the study, a striking 36% of consumers who typically ignore small businesses expressed that they would consider shopping locally if these retailers offered payment conveniences akin to those found in larger stores. Amidst a growing trend, 51% of survey participants plan to spend over $500 on holiday gifts—a significant increase from the previous year's 39%. Even a small shift of consumer spending towards small businesses could result in substantial revenue increases for these local retailers.

The study further highlights a unique opportunity in rural America, where consumers exhibit remarkable loyalty to small businesses; in fact, 54% prefer to shop locally, the highest preference across all surveyed demographics. While rural consumers show lower adoption rates of newer payment options, the study indicates that effective education and compelling security messaging are essential strategies to alleviate concerns and enhance consumer confidence, thereby empowering local merchants to increase their market share.

Jodie Kelley, CEO of ETA, emphasized, "The payments industry serves every merchant—from the corner café to the big-box retailer. For all merchants, and especially small and medium-sized businesses, today's payment innovations create new market opportunities and foster customer loyalty. This enables them to effectively meet consumer needs in a secure environment. The simultaneous focus on innovation and fraud prevention helps ensure commerce remains swift, secure, and inclusive."

The study involved the participation of 1,027 U.S. consumers in September 2025 and revealed that the experience associated with payment methods has become a pivotal factor influencing shopping decisions. A compelling 85% of consumers reported trying tap-to-pay technology, while 48% have utilized digital wallets. These high adoption rates illustrate the real opportunities for businesses that adopt modern payment options.

Mike Strawhecker, President of TSG, commented, "The current infrastructure allows businesses of any size, regardless of location, to offer a contemporary payment experience. Rural merchants benefit from existing customer loyalty; by integrating modern payment options and communicating clearly about security, these merchants can maintain that loyalty while competing head-on with online retailers."

Additionally, the study underscored that free shipping has emerged as the primary concern for online shoppers, taking precedence even over price. Urban areas are leading the charge in adopting payment technology, making them ideal markets for innovative checkout solutions.

The complete study can be accessed at www.electran.org/link for those looking to dive deeper into its findings.

About ETA

The Electronic Transactions Association (ETA) is recognized as the foremost advocacy and trade association within the payments industry. With members spanning significant payments and fintech entities—from long-established giants to emerging disruptors—the ETA facilitates the processing of approximately $52.7 trillion in annual purchases and person-to-person payment transactions worldwide. For more information, visit www.electran.org.

About TSG

The Strawhecker Group (TSG) is a premier analytics and consulting firm within the payments ecosystem, servicing over 1,000 clients ranging from Fortune 500 companies to a variety of global leaders. TSG merges trusted strategic services with market intelligence to empower clients with actionable insights. Learn more at www.tsgpayments.com.