The transition from cash to electronic payment will be accelerated by consumer behaviour learned from the COVID-19 pandemic, according to GlobalData, a leading data and analytics company.
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GlobalData’s Covid-19 Sector Impact: Payments webinar noted that online, cashless and mobile transactions would see long-term growth as consumers change their spending behaviour to avoid contact with the disease in the short term.
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Sam Murrant, Lead Payment Analyst at GlobalData, commented: “Lockdowns and social distancing measures will force consumers to reduce physical spending in stores, and a global recession looks very likely to follow. Payments will shift from cash to electronic alternatives – especially contactless card payments, mobile payments, and online payments – boosting revenue for the payments industry in the longer term.
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“Overall consumer payments growth will slow as lockdowns restrain consumer activity. E-commerce will experience a short-term boom, however, out of necessity, which will lead to sustained growth as consumer behaviour changes.”
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urrant concludes: “Mobile wallets also have an opportunity for growth, as they can leverage their ability to pay at the point-of-sale (POS) without ever needing to enter a PIN – presenting themselves as a safer means of transaction compared with contactless cards. Similarly, e-retailers have a chance to appeal to new customers.
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“Consumers that have never previously transacted online such as the elderly will now have to engage with this payment method, and will learn new behaviours. E-retailers, therefore, have a huge opportunity for long-term growth by hooking previously non-engaged customers.”
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Information based on GlobalData’s webinar: Coronavirus (COVID-19) Sector Impact: Payments
