Post-Covid surge in business start-ups fuels mobile payments

Research released today by the Commonwealth Bank of Australia (CBA) shows one in three Australians have started a small business or ‘side hustle’ since the start of the COVID-19 pandemic or plan to start one in the next 12 months.

Of those surveyed, 9% of these entrepreneurs started a business between March 2020 and January 2022, while almost twice as many (16%) have started trading in the past 12 months, highlighting sustained entrepreneurial activity among Australians since the Covid pandemic.

Australian Bureau of Statistics data also shows new business entries increased 19.7% in the 2022 financial year – significantly higher than average – reflecting workplace changes during Covid and hobbies morphing into side hustles, as well as opportunities in sectors struggling with labour shortages.

The findings coincide with the launch of a new CBA portable payments device, Smart Mini, to cater to the growing need for portable payment devices amongst small businesses who need to take payments on the go, such as tradies, gardeners and market stall operators.

The study¹, conducted in partnership with YouGov, looked at Australians’ attitudes towards opening a small business or ‘side hustle’ and what payment methods are important to them. The research revealed almost 9 in 10 (87%) of those surveyed who have started a business since the start of the Covid-19 pandemic or plan to start one in the next 12 months, regard the ability to accept payments on the go in their small business or side hustle as important – while four in five people have concerns around the speed of settlement and/or security of non-cash payments.

CBA’s internal data underscores this demand with 109,500 new business transaction accounts opened in 1H23 – equating to 4,200 a week. Some of the highest growth of new BTAs are in those sectors that are more likely to need a portable payment device, including those in gardening (19%), plumbing (11%) as well as painting (9%)². CBA also saw 16,100 new merchant facilities opened in 1H23 – a 31% jump.

Commonwealth Bank's Group Executive for Business Banking, Mike Vacy-Lyle, said: “The continued growth in new transaction account openings from small businesses shows an increasing number of Australians who are willing to open a small business, and this is also driving a growing need for mobile payments.

“From speaking to customers, it is clear that the ability to take payments on the go is now a key requirement. Smart Mini meets this need with seamless and secure integration of mobile payments with their main transaction account, saving valuable time in managing multiple accounts.

“Smart Mini will help those business owners start, run or grow, no matter where they are in their business journey. Coupled with the industry-leading 1.1% flat rate transaction fee³, Smart Mini will help businesses pay less each time their customer pays.”

Commonwealth Bank's General Manager of Merchant Solutions, Karen Last, said Smart Mini is available to all merchants regardless of whether they are currently CBA customers: “The launch of Smart Mini expands CBA’s range of payment solutions designed specifically for industries as diverse as retail and hospitality, and for a wide range of businesses, including micro and sole traders.

“Compatible with both Apple and Android^TM devices, it can be connected to CBA’s Smart Mini Hub, a self-servicing portal, allowing business owners to access a range of features and near real-time transaction insights relating to their business, enabling them to better manage their cash flow.

“With our survey highlighting widespread concern around the speed of settlement and security of mobile payments, we think CBA’s same day settlement of payments and our robust anti-fraud technology will be significant attractions for Smart Mini customers.”

Notes to Editors

Detailed findings of the survey are below:

• One in three Aussies (33% or approximately 6.61 million people) either have started a small business or a side hustle since the start of the COVID-19 pandemic or plan to start one in the next 12 months
• One in four Aussies (25% or approximately 5 million) have started a small business or a side hustle since the start of the COVID-19 pandemic (March 2020) – 9% (or approximately 1.79 million) started one between March 2020 and January 2022, while almost twice as many (16% or approximately 3.22 million) started one in the past 12 months (since February 2022). Another 1.61 million plan to start one in the next 12 months.
• Nine in ten (91%) businesses or side hustles accept payments on the go – on average, these make up 35% of their transactions
• Of those surveyed who have started a business since the start of the Covid-19 pandemic or plan to start one in the next 12 months, almost nine in 10 (87%) regard the ability to accept payments on the go in their small business or side hustle as important.

This study was conducted online by YouGov Galaxy from 16-19 February 2023 using a sample of 1,046 people aged 18+ across Australia. Results were post-weighted by age, gender and region to reflect the latest ABS population estimates.

About Smart Mini

• Same day settlement⁴ on all transactions, 365 days a year.
• Simple 1.1% flat rate transaction fee on all major cards, including AMEX.
• Lightweight and portable reader.

Smart Mini joins CommBank’s “Smart fleet”, a wide range of payment devices designed to suit multiple needs, industries and business sizes. This includes the Smart terminal launched last year, also with an industry-leading flat rate of 1.1% and the ability to customise the payments experience with an App Marketplace, such as a dedicated digital donations app for the charity sector.

For information on Smart Mini, visit: commbank.com.au/smart-mini

Things you should know: The information contained in this media release is published solely for informational purposes and provides general market-related information, and is not intended to be an investment research report. It does not take into account your objectives, financial situation or needs. You should consider seeking independent financial advice before making any decision based on information contained in this media release. The information in this media release and any opinions, conclusions or recommendations are reasonably held or made, based on the information available at the time of its publication but no representation or warranty, either expressed or implied, is made or provided as to the accuracy, reliability or completeness of any statement made in this media release. Eligibility criteria, terms and conditions and fees apply to CommBank’s merchant services. Please view our Merchant Agreement, Financial Services Guide and Operator and User Guides at our Merchant Support Centre.

¹ This study was conducted online by YouGov Galaxy from 16-19 February 2023 using a sample of 1,046 people aged 18+ across Australia. Results were post-weighted by age, gender and region to reflect the latest ABS population estimates.

² CommBank Business Transaction Account openings January 2022 – December 2022 period compared with year prior (January 2021 – December 2021).

³ 1.1% covers Mastercard, Visa, AMEX, JCB, eftpos, and UnionPay transactions (JCB coming soon for Smart Mini). Additional costs may apply for all other cards. AMEX is subject to approval, available to eligible customers only. Eligibility criteria, terms and conditions apply. Please contact AMEX for more information on 1300 363 614, available weekdays 8am to 6pm Sydney time.

⁴ Same day settlement is available on all EFTPOS transactions made before 9.30pm (Sydney/Melbourne time) for eligible customers with a CommBank Business Transaction Account and a linked CommBank merchant facility.

Google, Android and related marks and logos are trademarks of Google LLC. Apple is a trademark of Apple Inc., registered in the U.S. and other countries and regions. Mastercard and the Mastercard brand mark are registered trademarks of Mastercard International Incorporated. American Express is a trademark of American Express. Visa is a registered Trademark of Visa in the United States. JCB is a registered trademark of JCB International. Union Pay is a registered trademark of UnionPay International Co., Ltd. Eftpos is a registered trademark of eftpos Payments Australia Ltd.

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