Contactless Payments Are Here to Stay in the Age of Social Distancing

Fact: About 38 percent of consumers now view contactless functionality as a basic feature of payments—up 30 percent from last year. ¹ What this means for merchants is that the ability to accept contactless payments is rapidly transforming from a “nice-to-have” to an essential capability. And what this means for banks supplying merchant services to business banking clients is that they must ensure their partners offer contactless technology to meet the demand.

In the aftermath of the still-ongoing pandemic, social distancing will remain the “new normal’ for the time being. While no one knows how permanently the pandemic will affect social behaviors, it is clear the demand for touchless technology will not subside. Indeed, contactless payments drive an overall better user experience. Aside from decreasing the risk of disease transmission by eliminating contact with payment terminals and cash, contactless payments are faster and more convenient.

Currently about 65 percent of merchants accept contactless payments ² —and some may not be aware their current POS technology provides touchless capabilities.

Educating Business Bankers, Merchants and Consumers

With consumers increasingly demanding contactless payments and many merchants ready and enabled, contactless payments may simply be a matter of educating business bankers, merchants and consumers—and merchants still using older or less sophisticated hardware also present education and sales opportunities for banks.

Banks unaware of what contactless technology their payment processing partner provides should first find out, so they are better prepared to discuss this talking point with current and prospective merchants. You can also discuss launching a joint campaign with your payment processor to stress the growing demand for contactless technology and informing clients of available options. Such campaigns can also seek to encourage merchants to let consumers know that touchless card acceptance is available.

Card-issuing banks should also make a point of highlighting tap-and-go payment functionality to card accountholders built-in to their plastics.

Educating Business Bankers, Merchants and Consumers

Consumers demand it, merchants are ready and the benefits are multi-fold. Tap-and-go payments are the fastest, most convenient and safest way for consumers to pay. With increasing demand, contactless cards also help issuing banks keep their cards top-of-wallet. Finally, taking a proactive, consultative approach to highlighting contactless payments technology with merchants is another way to solidify business banking relationships and add value.

¹    “Impact of COVID-19 on Contactless Payments,” The Futurist Group, May 2020
²    Gardner, Bill, “Dirty banknotes may be spreading the coronavirus, WHO suggests,” The Telegraph, March 2, 2020