It’s reckoned that 110 million more contactless payment cards will be issued this year, beating pre-COVID-19 forecast expectations.
Driving the market is the belief that contactless is considered the more hygienic and safe way of making proximity payments. This is being reinforced by ecosystem players who are shifting their marketing messages.
Globally, contactless adoption will increase between +6% to +8% when compared to pre-COVID-19 expectations, with the issuance levels forecast to grow by 14% year-on-year, accounting for more than 65% of all cards issued in 2020
The estimates have been produced by global tech market advisory firm ABI Research.
Phil Sealy, Research Director at ABI Research, said: “Although the overarching trend toward contactless was well in place prior, COVID-19 will further increase the speed of contactless adoption, particularly within countries and economies where cash remains king, and usage not only being encouraged by payment ecosystem players and suppliers but also by governments and health organizations including the WHO.
“The way people pay for things is rapidly evolving and changing. COVID-19 has driven a significant shift in consumer spending habits spurred by economic uncertainty and a push toward the purchase of mainly essential items. There is also a surge in e-commerce whereby consumers are becoming even more heavily reliant on online retail channels to avoid crowded places to limit social interactions.”
The report highlights that the major payment networks, including Visa and Mastercard, are looking to aid in the pandemic by increasing contactless card spending limits. What’s more, many national and local authorities and governments, as well as merchants, are encouraging digital payments over cash, using the digital transaction method to limit contact with items and objects that are communal and used by multiple people—in this instance, point-of-sale terminals.
“COVID-19 is not only bringing contactless to the forefront of the digital payment experience, but also other next-generation payment card form factors. As consumers increasingly use and become more reliant on contactless, the question of how best to secure and limit fraud on increasing contactless transaction volumes and values will come into play,” added Sealy.