RN knows of at least 15 retailers who have already terminated their PayPoint contracts in response to a recent fee restructure, claiming the service is no longer profitable.

Following PayPoint’s announcement two weeks ago, which will see all retailers using the ‘yellow boxes’ charged £10 a month from 1 June as part of a move to “retire” the terminal, a number of retailers told RN they are weighing up their options.

Kate Mills, of Heath Stores in Kent, terminated her contract this week. She said she made a loss of £21 on PayPoint in April. “It is simply not acceptable for a small retailer to make losses so PayPoint can continue to make multimillion-pound profits,” she said.

Retailers can choose to opt out of PayPoint with no charge, or move onto the EPoS-enabled PayPoint One system.

Other retailers told RN they were now considering the best course of action. Londis retailer Stuart Reddish said: “PayPoint is a company with very little regard for its customers. They know as one retailer withdraws another will take its place.

“We have PayPoint at the Chesterfield store and we will have to look at the effect of taking the facility away from our customers.”

Joey Duhra, of Premier Jules Convenience in Shropshire, said he was also weighing up the offer, adding that he makes around £11.50 a week commission but sees no noticeable profits from add-on purchases. “We all know we’re virtually doing it for free,” he said.

To help retailers decide whether to invoke the 31 May opt-out clause before being tied into a five-year contract, the NFRN has created a fact sheet which it has sent to members.

NFRN chief executive Paul Baxter said: “Add-on purchases do exist, but their gross contribution to the profitability of the average is possibly lower than some may have been led to believe. The fact sheet adds more information to help retailers decide what is best for their business.”

Lewis Alcraft, commercial director at PayPoint, said: “We understand the change in terms might not be for everyone. We do not believe in forcing retailers into partnerships that do not work for their businesses.”