While the world is attempting a recovery from the coronavirus pandemic that has now infected over 9 million and claimed the lives of nearly half a million people, it is as important as ever to uphold social distancing protocols to ensure that we help flatten the curve. One way we can do this in our everyday life is to cut on the cash and opt for contactless payment.
Why contactless, and why now?
Contactless payment solutions have existed for many years now, more prominent in the West compared to the Middle East. In the UK for example, the technology has been available since 2007. In the MENA region, the tech has been available for a few years now, but hadn’t seen widespread adoption. With the onset of COVID-19, this is set to change.
A study conducted by Mastercard this year found that:
- 70% of respondents in the MEA region are now saying they are using contactless payments, citing safety and cleanliness as key drivers
- Six in 10 (61%) respondents in the region have swapped out their top-of-wallet card for one that offers contactless
- 79 percent said contactless payment methods have been easy to adopt. Contactless payments are up to 10 times faster than other in-person payment methods, enabling customers to get in and out of stores faster
- Additionally, Mastercard’s data revealed over 40% growth in contactless transactions globally in the first quarter of 2020. Further, 80% of contactless transactions are under $25, a range that is typically dominated by cash.
In the long run, the payment habits developed during this global crisis will most likely continue post-pandemic. After all, this trend has been developing since 2019.
“In 2019, the Middle East and Africa region saw 200% growth in contactless transactions,” Gaurang Shah, senior vice president of digital payments & labs, Mastercard MEA, told Wamda.
Contactless options are plenty
For those still unfamiliar with contactless payment, it involves tapping a contactless-enabled credit/debit card on a compatible payment terminal using RFID technology. Over the years, development in NFC (near-field communication) technology has allowed the use of devices such as smartphones and smart watches as substitutes for bank cards. Contactless transaction values are often capped as an anti-theft measure, given that no authentication like a signature or PIN code is needed to confirm a transaction.
As to the services available, these include Apply Pay, Samsung Pay, and plenty of others including many up-and-coming fintech firms that are finding growing opportunities in the MENA market.
“Tapping is deeply engrained in many markets, thanks to the growth of tap-and-go at transit turnstiles. This has led cardholders to adopt contactless wherever speed and convenience is key – with small, everyday purchases such as groceries, fast food, and vending machines, accelerating the shift from cash to card,” Khalid Elgibali, MENA division president at Mastercard, told news site Middle East Business.
So while we are experiencing a global recovery, and with COVID-19 potentially being an afterthought a year from now, contactless payment solutions are here to stay.