EVEN before the COVID-19 outbreak shook the global economy, contactless payments were already gaining traction, both in big and small companies.
The global pandemic accelerated this trend significantly as research data by Comprar Acciones showed that the third quarter of this year (3Q2020) experienced a 36% year-on-year (yoy) increase in contactless payments in Ireland alone.
This shows tremendous promise for companies to leverage on cashless payments while the trend is still going strong.
According to the report, a total of 182 millions payments were made in that period, bringing its value to US$3.4 bil. The data also revealed that 3Q2020 saw at least two million contactless payments made every day within those three months, with an average of US$36.66 mil spent every single day by consumers.
According to insights from S&P Global research, the situation in Ireland mirrors that of the US. A 3Q2020 survey shows that more than 40% of consumers are using cashless often since the beginning of the global pandemic.
More than one in six persons surveyed said that they had made their first ever contactless payments after the start of the pandemic.
The pandemic has also driven increased adoption for existing users, with 29% of consumers saying they had increased their use during the outbreak.
Also pointing to the increasing popularity of contactless payments, 48 countries increased spending limits on touchless transactions. On average, there was a 131% increase in transaction limits after the pandemic broke out.
Germany, which has always had a preference for cash, well illustrates this massive shift. It went from 35% cashless transactions before the pandemic to over 50% as of August 2020.
In the same vein, the pandemic has driven robust growth in the performance of contactless payment service providers.
A case in point is PayPal, which recorded its strongest growth in company history in payment volume during 3Q2020. In the three-month period, the payment processing company posted a 36% growth in total payments volume, reaching US$247 bil.
In comparison, its total payment volume for 3Q2019 was US$179 bil. The figure grew to US$199 bil in 4Q2019 and then dropped to US$191 bil in 1Q2020. Following a COVID-based surge, it shot up to US$222 bil in 2Q2020.
PayPal’s revenue for 3Q2020 was US$5.46 bil, marking a 25% yoy increase. – Nov 19, 2020
