The Role Of Pandemic In The Increased Use Of Contactless Payments

coronavirus pandemic increased use contactless payments frictionless pay mobile

Contactless payment technology was introduced into the world of client transactions back in the 1990s, although, at the time, it was only used by a few merchants and retailers such as Mobil, McDonald’s and Bank of America. Technology has come a long way since the days of FreedomPay and Upass leading to more and more people going the touchless way over time. 

Currently, the number of users numbers in the hundreds of millions, but this was not always the case despite much publicizing since it got into the mainstream public in 2007. The contactless payment system, now commonly referred to as ‘tap and go,’ has faced much skepticism, especially in the US, due to security concerns regarding skimmers who could use their phones to steal users’ credit/debit card information for malicious purposes. This led to the adoption rate going at a snail’s pace, as more and more Americans opted to use cash in their transactions. 

Contactless Payments In The Casino Industry 

One of the industries that’s going to quickly adopt cashless payments is the land-based casino industry because of forced closures for the better part of 2020. The best real money online casino platforms have for years proved that it is possible for players to enjoy casino games without having to have cold hard cash at hand. Nonetheless, until last year, the idea of contactless payments increasingly faced some challenges that made the adoption process harder than it should be. 

Prior Resistance From Governments 

While contactless payments are fast becoming part of the ‘new normal’ after endorsement from world authority figures such as WHO, some other authorities had not been quite taken by this concept before the pandemic. 

At the forefront of contactless payments are private banks and financial tech companies. Central banks around the globe, for example, were pushing back due to the fear of existing paper money facing some sort of redundancy. 

But then, after the pandemic happened, more and more governments had to join the bandwagon to protect their citizens. There was a lot of concern for possible infection via handling of banknotes, and the same banking institutions were backed into a corner. Right now, it is not uncommon to find stores indicating that they do not accept hard cash for transactions. 

The Year 2020 Changed The World Forever

With the coronavirus outbreak at the beginning of 2020, everything changed, and the world had to adapt to survive. Immediately after the announcement of lockdown orders in different countries across the world, the number of consumers using digital wallets spiked. While previous attempts to convince consumers of the safety and reliability of contactless payments have been yielding little results, sanitation concerns in the Covid-19 era were the saving grace of financial providers offering this technology. 

Visa CFO and Vice Chairman Mr. Vasant Prabhu revealed in an interview with Yahoo Finance (YF) that just in the first 6 months of 2020, more than 80M contactless cards were requested by consumers. By September 2020, nearly 200M touchless cards were already active. According to Mastercard, mobile and contactless card payments in grocery stores, supermarkets and pharmacies skyrocketed during the March 2020 lockdown, with a 25% increase compared to the same period in 2019. 

Shifting Consumer Trends 

In the USA, for example, a region where consumers have had a hard time trusting contactless transactions, the pandemic was a big driver of change. A few months into 2020, just over 30% of consumers in the US became users of contactless cards for the very first time. And now, it is projected that between 2020 and 2024, the usage of contactless payments will increase eightfold. 

On the world front, about 79% of end-users are now reported to be using cashless payment methods with the majority being from Asia. This is no surprise with China’s push to become the first cashless society even before the Coronavirus pandemic probably since this is not the first deadly pandemic to hit the nation. Of course, the rise of cutting-edge fintech platforms such as WeChat Pay and AliPay has expedited things in the Chinese market. 

The Future Of Transactions Is Contactless 

In case you are among those who worry about the security of contactless payments, you should know that trusted carriers such as Google Pay, We Chat, AliPay, Apple Pay and Visa use infallible data encryption technologies to guarantee 100% safety. 

Better yet, there are plenty of tweaks you can make depending on your payment provider to add extra layers of security to protect yourself from fraudsters while using contactless payments. The additional features include two-factor authentication and biometrics, which will further beef up your account’s security. Believe it or not, contactless payments and similar trends will be the norm in a post-covid society in 2021 and beyond.

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