An additional 110m contactless payment cards will be issued in 2020 compared with pre-Covid-19 forecast expectations, ABI Research predicts, bringing the total in circulation to more than 2bn.
“Covid-19 is expected to have a profound effect on the payment cards market,” the analysts say.
“Contactless is considered the more hygienic and safe way of making proximity payments, and this is being reinforced by ecosystem players who are shifting marketing messages from contactless transactions used to increase convenience levels toward safety and health.
“Globally, contactless adoption will increase between 6% to 8% when compared to pre-Covid-19 expectations, with the issuance levels forecast to grow by 14% year-on-year, accounting for more than 65% of all cards issued in 2020.”
“The way people pay for things is rapidly evolving and changing,” says research director Phil Sealy.
“Covid-19 has driven a significant shift in consumer spending habits spurred by economic uncertainty and a push toward the purchase of mainly essential items.
“There is also a surge in e-commerce, whereby consumers are becoming even more heavily reliant on online retail channels to avoid crowded places to limit social interactions.”
“Although the overarching trend toward contactless was well in place prior, Covid-19 will further increase the speed of contactless adoption, particularly within countries and economies where cash remains king.”
“Covid-19 is not only bringing contactless to the forefront of the digital payment experience, but also other next-generation payment card form factors,” Sealy adds.
“As consumers increasingly use and become more reliant on contactless, the question of how best to secure and limit fraud in increasing contactless transaction volumes and values will come into play.
“Biometric payment cards are well positioned as a solution that offers a contactless payment card experience without limits.
“The use of multi-factor contactless transaction authentication will become a key theme post-Covid-19, extending security previously reserved for high computer-powered devices such as smartphones, and mirroring the experience and security features onto the passive payment card form-factor.”