Hospitality businesses have been on a rollercoaster journey over the last few years, with many only just recovering from the Covid-19 pandemic. But the good news is consumer spending is on the up.
Data from the UK’s Office for National Statistics shows that in 2024, spending across the hospitality sector doubled from the previous year. In the tourism sector, airlines and hotels in particular saw a sharp rise in the same period, driven by increased summer travel spending. The largest positive contribution to growth between October and December 2024 was from restaurants and hotels – a 1.3% increase compared with the previous quarter.
Our own data backs this up. According to the Lloyds Bank Business Barometer, released in May 2025, business confidence bounced back to 50%, marking the highest level in nine months, and signalling the impact of reduced global trade tensions. While we know that fluctuations do occur month on month and the global economic outlook remains uncertain, this increase in confidence is an encouraging sign.
Look through the payment data lens to get closer to your customers
That’s a massive opportunity for canny hospitality businesses – as long as they have the right payment solutions in place to make every customer transaction count. Knowing which are the most popular spending categories for different age groups can help merchants create more targeted offers and incentives for customers, which in turn can lead to more sales and stronger revenues.
At Lloyds, our datasets give us key insights that hospitality businesses can use to boost payment acceptance and profits. This is because Lloyds Merchant Services handles card payments for 34,000 businesses, along with the transaction data from our 27 million customers in the UK. That includes exclusive data from hospitality clients, such as how and when people are spending their money in bars, hotels and other hospitality venues.
Here’s what we’re seeing in spending trends:
- Overall hospitality spending in 2024 was up 14% year-on-year compared to 2023, on the back of sports events like the European Championships, and the ‘Taylor Swift’ effect, with her tour attracting hundreds of thousands of attendees to various venues across the UK.
- A big shift, and one that hospitality businesses can tap into, is that Tuesday is fast becoming the new Friday, with a 16% uplift in spend on food and drink on Tuesdays year-on-year.
- The sharpest rise in food and drink spending came from over-60s.
Contactless and digital wallet spending are on the rise
By monitoring changing spending trends, hospitality merchants can keep pace with the way people pay in the UK. For example, according to data from UK Finance, almost four out of ten (38%) of all payments in 2023 were contactless, and one-third of UK adults were using mobile contactless payments at least once a month.
In January 2025, it was announced that the £100 contactless limit will be scrapped, enabling people to use contactless in more locations and for larger-value purchases more quickly and easily. Working with expert payment providers means that businesses won’t have to lift a finger as their payment provider can remotely update POS terminals, leaving them free to focus on their customers.
Increased adoption of loyalty-linked payments and subscription models.
Whether it’s a discount on their customers’ daily coffee, cashback, or exclusive in-app perks like instant bonus points, loyalty schemes are now a firm favourite with customers. A well-designed loyalty scheme can not only boost customer spending, but also be a merchant’s best customer acquisition tool, enabling them to collect valuable data from every customer transaction.
There’s also an undeniable shift towards alternative payment methods like instalment-based Buy-Now-Pay-Later (BNPL). As of 2025, 2 in 5 UK adults (42%) have used BNPL services at some point, or 22.6 million people. A further 1 in 10 Brits (9%) intend to use BNPL in the future, taking the total number of users to half of the population (51%).
Although BNPL initially took off with younger people (Millennials and Gen Z) in verticals like fashion, amid the cost-of-living crisis, older demographics are also appreciating the flexibility of being able to spread the cost of holidays, hotel, cruise and airline bookings with BNPL.
The phygital revolution: blending physical and digital for the best customer experience
In restaurants, pubs, cafes, and hotels, it’s all about speed and convenience. Think mobile apps, digital wallets, QR codes, and mobile point-of-sale (POS) devices. These tools allow businesses to take payments anywhere the customer is, rather than making them wait in line at a traditional countertop checkout.
For hotel and hospitality businesses, integrated and customisable pre-payment models for booking and events take the hassle out of taking payments and reservations. With full or partial pre-payment online or through customers’ mobiles, business owners can get peace of mind against last-minute cancellations and no-shows, and bolster cashflow visibility. And they can re-sell cancelled bookings to other customers at short notice.
Why integrated POS systems are essential for hospitality businesses in 2025 and beyond
Today’s hospitality merchants can capitalise on all of these important trends by integrating POS acceptance devices or checkout gateways with booking or reservation systems, customer relationship management, data reporting and cashflow tools.
The good news is that there is a wide range of POS terminals and integrated solutions available to help businesses take payments anywhere and everywhere, from cards to digital wallets. Lloyds’ range of Clover POS payment terminals are simple-to-use devices that come with a range of monthly rolling contract options with clear pricing, and enable hospitality businesses to integrate a full suite of apps to help them run their businesses. With calls answered in just 32 seconds on average, business owners can count on fast, friendly, and helpful support whenever they need it.
Ultimately, with the right POS payment solutions in place, today’s hospitality businesses stand on the verge of unlocking a new world of business growth opportunities.
