The COVID-19 pandemic triggered a global crisis that reshaped the way we live and has revolutionized the way we make payments. As the world has emerged from the pandemic, it is evident that the payment landscape has undergone significant transformations. We have seen a surge in digital payments, and a prioritization of contactless methods.
In this blog we will examine how the global pandemic has reshaped payment trends and consumer behaviours.
The Rise of Digital and Contactless Payments
The fear of transmitting the virus through physical contact led to a shift towards digital and ‘tap and go’ payment methods. Consumers sought alternatives to cash and chip-and-pin transactions, favouring payment options like contactless credit cards and mobile wallets.
This trend has continued post-pandemic and will persist as customers continue to value the convenience and safety that digital and contactless payments provide.
The fifth edition of the Visa Back to Business Study polled 5,000 consumers and 2,250 small business owners in nine countries in June 2021. They found 68% of consumers said the coronavirus permanently changed how they will pay for things, now and in the future. Why The Post-Pandemic Payments Future Is Digital (forbes.com)
Businesses must ensure that their payment systems can accommodate contactless payments to cater customers’ preferences and improve customer satisfaction.
E-commerce Boom and the Growth of Online Payments
The pandemic created a surge in e-commerce, as consumers turned to online shopping for their essential and non-essential items. The convenience of ordering from the safety of your home and the availability of a wide range of products fuelled this trend. Consequently, online payment methods became the preferred choice for completing transactions.
Website traffic has soared meaning business need to have optimized their online platforms to offer the most seamless shopping experience, implementing secure online payment solutions to instil trust and encourage repeat purchases.
Contactless Payments Go Beyond Retail
While contactless payments gained popularity in retail, their adoption extended to various industries and services. Transportation services and restaurants also implemented contactless payment options to minimize physical contact and enhance overall efficiency.
Businesses in diverse sectors should have explored opportunities to implement contactless payment solutions, thus catering to the increasing demand for seamless and hygienic transactions.
Shift Towards Digital Banking and FinTech
During the pandemic, traditional banking encountered challenges due to social distancing measures. Consequently, consumers embraced digital banking and FinTech solutions, seeking remote access to their finances. Features like mobile banking apps, instant transfers, and virtual wallets gained significant traction during the pandemic.
Financial institutions and FinTech companies should invest in user-friendly, secure digital platforms to meet the popular demand for remote banking services today.
Growing Interest in Cryptocurrencies and Central Bank Digital Currencies (CBDCs)
The economic uncertainty caused by the pandemic led to increased interest in cryptocurrencies as potential stores of value and investment assets. Similarly, several countries have explored the concept of Central Bank Digital Currencies (CBDCs) as a means of bolstering financial inclusion and enabling faster, cheaper cross-border transactions.
Businesses should monitor the developments in the cryptocurrency and CBDC space and consider the integration of digital currencies into their payment systems as the technology matures.
Overall, the pandemic has accelerated the adoption of digital and contactless payment methods, transforming the way consumers make payments in a post-pandemic world. The rise of digital and contactless payments, ecommerce and the growth of online payments, the embracing of digital banking and the growing interest in cryptocurrencies are just a few of the trends which have reshaped the payment landscape today.
To thrive in this new era, businesses must make sure they have adapted – by offering innovative, secure, and convenient payment solutions that cater to new consumer preferences. By staying attuned to these payment trends, businesses can navigate the challenges of the post-pandemic world and build stronger connections with their customers.
Income Group plays a role in the post-pandemic world. A Fintech organisation that provides faster payments, creating a seamless payroll process.
IGsend from Income Group processes payments in 27 seconds, enabling real-time payments and Earned Wage Access for employees.