Contactless Payments: Touch-Free Trends to Understand & Adopt
The coronavirus pandemic’s impact will be felt for years, but one side effect has already swept the business world. The pandemic created an emphasis on cleanliness and social distancing, and with that came a new look at cash and traditional credit card payment protocols. Where a card used to be handled by a cashier then given back to a consumer, these days contactless payments have emerged as the smart way to go about one’s life while also minimizing the risks of these interactions.
According to a study by the management consulting firm A.T. Kearney, as recently as 2018, only 3% of U.S. credit cards were enabled with contactless chip technology, compared to 96% of South Korea cards, and 68% of cards in Australia. But in the age of social distancing, the use of contactless payments rose sharply and will likely continue to gain traction, with more consumers than ever before seeking out options that allow them to pay without contact. This trend is evident in a 2020 Accenture report detailing how COVID-19 will impact payments, forcing payment provides to speed up their digital innovation efforts to meet the consumer demands associated with digital payment systems.
Contactless payments, which use Near Field Communication (NFC) technology, can be done in several ways. Shoppers can tap their credit card, smartphone, or smartwatch to a terminal, reducing the physical touchpoints by eliminating both cash transactions and the smaller interactions with the cashier or public terminal asking for a PIN to be entered.
While contactless payments increase businesses’ reliance on consumer technology that enables those payments, like smartphones, smartwatches, and contactless credit cards, it also comes with many benefits. Contactless payments tend to be faster and more secure than traditional payment options. NFC technology is encrypted to safeguard transactions and protect consumer data. Eliminating the need to touch and swipe cards means less time waiting in lines and a safer way to pay.
Consumers proved that 2020 was the year of contactless payment, with safety being the chief factor for increased adoption. The 2021 Visa Back to Business Study shows that contactless payments are here to stay. 74% of SMBs expect consumer to prefer contactless payments even after the general population has access to the coronavirus vaccine. “Meeting consumer demand for digital payments is critical, as 65% of consumers believe that post-vaccine, their preference is to use contactless payments as much, or even more than, they are currently.”
As a post-COVID cashless society gains traction, more Americans will become accustomed to paying for groceries and small items with their phones or by simply tapping their cards.
They will come to expect contactless payments everywhere they go, no matter how small the business or the purchase. Creating a welcome environment for contactless payment options is a good way to help future-proof your business.
At PayTech Trust, we offer secure merchant accounts and web-based solutions for businesses of all sizes. With our collaborative suite of services and world-class cybersecurity protocols, PayTech Trust has the experience and the expertise to help your business move safely into the world of online credit card processing. Download free eBook