Saturday, July 2, 2022
Home > Finance News > Contactless payments grew 6x in last 3 years

Contactless payments grew 6x in last 3 years

The percentage of contactless transactions in total F2F transactions grew by more than 6x, from

Quick Service Restaurants (QSRs), other restaurants, food and grocery, and drugstores and pharmacies are the market segments with the most contactless transactions by volume across both debit and credit cards.

According to Worldline, while 25% of all transactions at supermarkets were contactless in January 2020, these transactions rose to 31% by January 2022.

On the other hand, market segments such as insurance, airlines and telecom/utilities continued to rank lower in 2020 across both credit and debit cards. The airlines sector has seen a spike in contactless debit card penetration in 2021, which could be attributed to the revision in the contactless payment limit.

Further, contactless has become the preferred way of payment for the majority of affluent clients, particularly for everyday necessities such as food and groceries, gasoline, and medication stores and pharmacies. Affluent cardholders with digital-focused personas, such as ecommerce and electronic shoppers, luxury travellers, and passionate wallet users, who value convenience and time, have a higher adoption rate for contactless and card-on-delivery choices.

Key drivers of contactless growth

1.) Availability:
An increasing number of small merchants (like grocery and convenience shops) are also enabling ‘tap to phone’ with payment processors like Worldline and Paytm to accept in-store contactless payments without incurring POS fees.

2.) Convenience:
Since contactless payments do not need a signature, PIN or OTP, the speed of checkout is greatly enhanced, while the associated inconvenience of cash handling, keypad errors and network outages are eliminated.

3.) Utility:
Fuel, apparel & accessories, lodging, and retail goods will drive the next phase of growth, potentially increasing the share of contactless in F2F transactions.

4.) Security: Since RBI caps the maximum number of daily contactless transactions at 5, the exposure to fraud is limited, in case the physical card is lost or stolen. For those issuers and cardholders for whom security is a primary concern, there is probably no safer technology.

Maharashtra, Karnataka, Delhi NCR, Andhra Pradesh, Telangana, Tamil Nadu, Gujarat, Kerala, Haryana, and Uttar Pradesh are amongst the states with highest number of contactless transactions in India.

Source link

Leave a Reply

Your email address will not be published.

%d bloggers like this: