With consumers worried about touching surfaces during the coronavirus pandemic, the use of mobile payments and contactless credit or debit cards has significantly increased in the past few months, according to research released today by the National Retail Federation and Forrester.
“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,” NRF Vice President for Government Relations, Banking and Financial Services Leon Buck said. “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.”
“Touchless payment methods are an important part of ensuring the health of retail workers and consumers but they do raise concerns about the security of payments and the fees charged to merchants to process transactions,” Buck said. “Retailers, banks and card companies need to work together to ensure that these transactions remain secure. And the card industry should not take advantage of this situation to rake in extra fees merchants would not pay otherwise. Card processing fees already drive up costs for retailers by far too much and ultimately increase prices paid by consumers.”
The State of Retail Payments study, conducted for NRF every other year by Forrester, found 67 percent of retailers surveyed now accept some form of no-touch payment. That includes 58 percent that accept contactless cards that can be waved past a card reader or tapped on the reader, up from 40 percent last year, and 56 percent that take digital wallet payments on mobile phones, up from 44 percent. Many retailers also allow customers to pay online or over the phone and then pick up merchandise in-store or at curbside, avoiding the need to touch card readers, sign for transactions or enter a PIN.
Since January, no-touch payments have increased for 69 percent of retailers surveyed. Among retailers that had implemented contactless payments, 94 percent expect the increase to continue over the next 18 months. As of the time of the survey, 19 percent said no-touch accounted for more than half of their in-store transactions while 30 percent said it was 10 percent or less… NRF