Of all the payment innovations of the last few years, few have seen such meaningful impact as contactless technology. P2P mobile payments are moving forward in fits and bursts, Bitcoin hype comes and goes in waves, but contactless remains continues to build momentum steadily.
For example, more than one million contactless journeys were made every single day during the Christmas period on Visa contactless cards alone, according to Visa Europe. In total, contactless now represents 25 per cent of all pay-as-you-go transactions on TfL and with Black Cabs soon adopting the technology also, that number is going to rise.
In just three months since the introduction of the higher spending limit, the UK jumped from spending £634m to £1.02 billion in a single month, according to new data from The UK Cards Association. By contrast, in January 2015, contactless spending amounted to just £287 million.
No one is safe from contactless innovation, not even board games as Hasbro has showcased its new version of Monopoly that has no cash, instead introducing ATMs and contactless cards.
Danger of being ‘left behind’
The contactless revolution is so strong that payment processors such as Worldpay have started to issue warnings to retailers not offering contactless payment options, telling them they are in danger of being ‘left behind’.
Recent data from the payments processor shows that the number of UK contactless transactions processed by them rose by 160 per cent in 2015, with monthly payments using the technology peaking at 45 million. Worldpay has now processed over £4 billion in contactless transactions since 2012.
Contactless an ‘expectation’
Worldpay stresses that people are beginning to expect contactless payment methods to be offered, particularly in fast-paced shopping environments where time and convenience in paying are of the essence.
Dave Hobday, UK Managing Director of Worldpay, commented: “The UK has been a trailblazer for contactless adoption, and we’re seeing that play out today as the technology plants itself firmly in the mainstream. Raising the limit on contactless to £30 opened the floodgates by broadening the opportunities for consumers to use the technology, but it’s far from the end of the story.
“Contactless cards may have paved the way for the enormous surge in tap and go payments we’re seeing today, but the next 12 months will be defined by how consumers take to paying for goods on their smartphones – especially with features such as High Value Contactless.”
In four years’ time, we will see new regulations coming that will require all card terminals in the UK to be contactless enabled. However, Hobday says that retailers should not delay, “These numbers show how contactless has moved from novelty to normal in little more than 4 years – retailers still on the sidelines without a strategy to accommodate this technology could be left in the dust and risk of driving loyal customers away.”
Check out the infographic below detailing the sectors leading the contactless charge.
Credorax discusses the importance of cross-border payments and how choosing the right acquirer can determine future success.
Daniel Smith, Director of Relationship Management, Basset and Gold interview: “Consumer demand for new and innovative forms of finance is soaring”
Basset and Gold has announced the launch of its new Innovative Finance ISA (IFISA).
CEO and Co-Founder of Payworks Christian Deger explains how developing partnerships between SMBs and VARs is benefiting the industry.
Amin Lalani, CIO Executive at Huawei Western Europe, explores the rise of self-serving banks.