NRF: Contactless Payments On The Rise Following COVID-19
The release from the National Retail Federation (NRF) has found that, over the months passed since the coronavirus broke out and hit pandemic status around the globe, an increasing number of consumers have been turning to mobile payments and contactless debit or credit cards to pay.
NRF’s Vice President for Government Relations, Banking and Financial Services, Leon Buck, said “Health experts say there is no clear evidence that COVID-19 is transmitted by cash or credit cards but retailers are putting health and safety first and have rolled out a variety of no-touch payment options in order to err on the side of caution.”
He added “While mobile payments and contactless cards have accounted for a minority of payments in the past, the pandemic has clearly driven consumers to change their behavior and retailers to accelerate their adoption of the technology.”
The report, created in collaboration with Forrester, clearly demonstrates the consciousness being displayed by both consumers and retailers, with health concerns taking priority over the concerns that surround the security and safety of touchless payments. Whilst they can be beneficial and improve public hygiene, processing fees can also be increased for transactions, meaning the cost of safety is increased, which can be damaging for smaller businesses and retailers.
To ensure that card payments can be safely completed, it is crucial that banks work closely with retailers and merchants to ensure that transactions will remain affordable and feasible, whilst as secure as possible. Card processing fees can already make things difficult for retailers, increasing the prices paid by consumers.
Forrester Consumer Technologies surveyed a number of US-based consumers, discovering that 19% of those made a digital payment in-store for the very first time this May. 62% of the consumers that were a part of this group used their mobiles, and 56% used contactless cards. 67% of consumers within that group across the US were satisfied with their experience and would continue to use contactless payments.
The top concern for retailers involved in the survey is higher costs, including the increased fees for processing transactions, with 67% of retailers responding with that. A fee of around 2.5% on average is added by banks to credit card payments in person, but 2.8% is added if the card is used online. Retailers are expected to pay an additional $1.6bn this year with additional costs being added to payments.
