Consumer Appetite for Digital Payments Takes Off

As the world went into pandemic lockdown in 2020, consumers shifted their spending habits to embrace contactless tap-and-go payments and online shopping. As stores closed and social distancing took hold, retailers worldwide moved their businesses online, embraced e-commerce and explored the potential of new ways to pay.

More than a year later, research from Mastercard shows that the adoption of new payment technologies is rising, and consumer appetite for new, fast and flexible digital experiences continues to grow.

The Mastercard New Payments Index, conducted across 18 markets around the world, shows 93% of people will consider using at least one emerging payment method, such as cryptocurrency, biometrics, contactless, or QR code, in the next year. Nearly two-thirds of respondents (63%) agree they have tried a new payment method they would not have tried under normal circumstances, but the pandemic has galvanized people to try flexible new payment options to get what they want, when they want it. With this interest and consumer demand also comes a greater expectation for businesses to provide multiple ways to shop and pay. In fact, more than half of consumers say they would avoid businesses that do not accept electronic payments of any kind.

Contactless technology was the digital catalyst to explore new payment options because of its fast, secure and touch-free experience. 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. 3 A year into the COVID-19 pandemic, contactless is showing its staying power and dynamism – in the first quarter of 2021 alone, Mastercard saw 1 billion more contactless transactions as compared to the same period of 2020, with particular momentum in emerging contactless markets like the U.S. and Brazil, where contactless penetration in the two markets combined grew by nearly 3x year-over-year. 3 All signs point to a continued growth path for contactless, with nearly 7 in 10 consumers anticipating using a contactless card this year.

Looking to the future, digital currencies, biometrics, contactless and QR codes are trending as emerging payments technologies as people’s comfort with them and understanding of them increases and the use of cash decreases. In fact, 71% of people say they expect to use cash less moving forward. The exploding interest in new payment technologies may encourage businesses to expand their options at checkout.