Covid-19 has been one of the biggest contributors to the growth of contactless payments. Businesses have adopted their approach to reduce the amount of cash they handle. Whilst consumers have also adjusted their willingness to use cashless methods such as Apple Pay and Google Pay
Contactless Payments
Contactless payments have become a part of a bigger transformation for digital financial services. In fact the use of Contactless Payment increased in 2020 with stats showing that nine out of 10 UK card payments were contactless, according to data from Barclay Card.
Contactless payments allow us the ability to pay by tapping a physical card, smartphone or wearable tech that is enabled by Radio-frequency identification (RFID) or Near-Field Communication (NFC) technologies over a card reader.
Further research from Computer Weekly suggests that; “Despite many shops closing for long periods during various lockdowns to reduce the spread of Covid-19, the total value of contactless payments increased by 7% in 2020 compared to 2019. For example, there was a 29% increase in the use of contactless in UK grocery stores”
Around the world, consumers are choosing to shop with businesses that offer contactless at the point of sale. According to The Visa Back to Business Study they stated that “Contactless payments have become a driving differentiator: If all other factors were equal (price, selection and location), nearly two-thirds (63%) of consumers would switch to a new business that installed contactless payment options,”
Changing the payment experience
In 2021 businesses have quickly adapted their shopping experiences beyond traditional in-store shopping, which has led to a hybrid of commerce technology to refine processes and become more efficient at delivering needed omnichannel experiences.
A new study by Juniper Research has also found that the total value of transactions processed by POS terminals will exceed $17.3 trillion by 2026, from $14.8 trillion in 2021, representing a growth of almost 28%. The growth is driven by a continually evolving payment processing landscape in which cash plays a reduced role. The report also found that POS vendors must ensure they support omnichannel retail business models and are prepared to compete with alternative payment methods such as QR code payments.
The pandemic and increased cashless currencies bring challenges that POS vendors must manage, with retail moving online and enabling contactless processing. The report recommends that POS vendors must integrate smart capabilities, including stock management and data analytics to their terminals, to maximise the value of their platforms to end users.
The Covid-19 pandemic has proven that Digital payments, especially contactless payments have emerged as a fool proof way for businesses to operate, as it provides speed and convenience for both consumers and retailers, especially at times when keeping queues short and consumers happy have become the priority. Even in a post pandemic world contactless payments will continue to grow as the preferred method of payment.
