South African consumers will consider payments such as cryptocurrency1, biometrics, contactless or QR code in the next year, according to Mastercard New Payments Index. File photo.
Philippa Larkin
THE MASTERCARD New Payments Index, released yesterday, showed that 95 percent of South African consumers will consider using at least one emerging payment method, as Covid-19 altered their spending habits away from traditional avenues to embrace contactless tap-and-go payments and online shopping.
“Between the first quarter of 2020 and the same period in 2021, more than 100 markets saw contactless as a share of total in-person transactions grow by at least 50 percent. A year into Covid-19, contactless is showing its staying power and dynamism. In the first quarter of 2021 alone, Mastercard saw 1 billion more contactless transactions globally as compared to the same period of 2020.
“All signs point to a continued growth path for contactless, with nearly 7 in 10 consumers globally anticipating using a contactless card this year,” the index found.
South African consumers will consider payments such as cryptocurrency, biometrics, contactless or QR code in the next year.
Craig Vosburg, the chief product officer at Mastercard said: “The pandemic made us think differently, partly out of necessity.”
He said to deliver the choice and flexibility that consumers needed and increasingly expected, retailers worldwide had to offer a range of payment solutions that were easy to access and always on.
“As we look ahead, we need to continue to enable all choices, both in-store and online, to shape the fabric of commerce and make the digital economy work for everyone,” Vosburg said.
The index showed that more than two-thirds of respondents (66 percent) agreed they had tried a new payment method they would not have tried under normal circumstances.
More than half (57 percent) of South African consumers, said they would avoid businesses that did not accept electronic payments of any kind. Additionally, just more than two thirds (77 percent) of South African respondents said that digital payment methods helped them save money.
Mastercard said looking to the future, digital currencies, mobile wallets, wearables, biometrics, contactless and QR codes were trending as emerging payments technologies as people’s comfort with them and understanding of them increased.
“In fact, 86 percent of South African consumers have more ways to pay compared to this time last year. The exploding interest in new payment technologies may encourage businesses to expand their options at checkout,” it said.
The index found four in 10 people (41 percent) in South Africa said they planned to use cryptocurrency in the next year, with more than half noting they are more open to using it than they were a year ago.
Thirty-eight percent of South African consumers said they planed to use biometric verification methods, such as fingerprint authorisation, in the next year, while 46 percent of South Africans expecting to use more payment technologies such as QR codes in the next year.
Contactless cdards and digital wallets were becoming more popular, as 63 percent of South African consumers said they used their contactless card, and 52 percent said they tapped their smartphone mobile or digital wallet more than other payment methods in the last year.
Earlier this year, the Convergence of Payments – PwC Payment Trend Series said that traditional payment systems were out of date and could not keep up with the demands from a digitally focused economy.
Chantal Maritz , the strategy and payments transformation lead at PwC, said: “The traditional way to pay has been disrupted, progressing payments beyond the conventional model into a new paradigm. The new opportunity lies within the context of a payment. Payments provide insights into managing your business better, understanding your customers more deeply and operating in a more efficient, effective and innovative manner.”
philippa.larkin@inl.co.za
BUSINESS REPORT ONLINE
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