The COVID-19 pandemic and subsequent nation-wide lockdown hastened the shift to contactless tap-and-go payments and online shopping among consumers the world over.
In SA, 95% of those consumers surveyed say they will consider using at least one emerging payment method, such as crypto-currency, biometrics, contactless or quick response (QR) code, in the next year.
This is based on Mastercard’s New Payments Index, which surveyed 15 569 consumers in 18 countries worldwide, including SA.
Overall, more than two-thirds of respondents (66%) have tried a new payment method they would not have tried under normal circumstances, but the pandemic has galvanised people to try flexible new payment options.
On the local front, more than half (57%) of South African consumers say they would avoid businesses that do not accept electronic payments of any kind.
Additionally, just over two-thirds (77%) of South African respondents say digital payment methods help them save money.
Says Craig Vosburg, chief product officer at Mastercard: “The pandemic made us think differently, partly out of necessity. To deliver the choice and flexibility that consumers need – and increasingly expect – retailers worldwide need to offer a range of payment solutions that are easy to access and always on.
“As we look ahead, we need to continue to enable all choices, both in-store and online, to shape the fabric of commerce and make the digital economy work for everyone.”
Digital payments boom
In its findings, Mastercard’s New Payments Index points to digital currencies, mobile wallets, biometrics, contactless and QR codes as the emerging payment technologies of the future.
In SA, for example, 86% of consumers have more ways to pay compared to this time last year, it reveals.
According to the index, crypto-currency is gaining ground, as four in 10 people (41%) in SA say they plan to use crypto-currency in the next year, with more than half (60%) noting they are more open to using it than they were a year ago.
“While consumer interest in crypto-currency – especially floating digital currencies such as Bitcoin – is high, work is still required to ensure consumer choice, protection and their regulatory compliance.”
On biometric payments, the respondents’ perceptions of safety and convenience have been front and centre over the past year. Some 38% of South African consumers say they plan to use biometric verification methods like fingerprint authorisation in the next year.
Furthermore, six in 10 consumers say they are excited about the potential of biometric verification methods such as gait or walk assessments and fingerprint authorisation, and 56% feel safer using biometrics to verify a purchase than entering a PIN.
Respondents believe QR codes will remain post-pandemic, with 46% of South Africans expecting to use more payment technologies like QR codes in the next year.
“In South Africa, the majority of respondents perceive new payment methods like QR codes to be cleaner (74%) and more convenient (70%) than cash for in-person payments, as it is likely that consumers are using their own mobile devices.”
Similarly, online payment gateway PayFast also found the uptick of online shopping in SA’s retail sector has fuelled the use of QR code payments.
According to Mastercard’s New Payments Index, 63% of South African consumers said they used their contactless card, and 52% said they tapped their smartphone mobile or digital wallet more than other payment methods in the last year. “This trend is set to continue, with 60% of South African respondents saying they are likely to tap a smartphone to pay in the coming year.”
With consumer interest around new payment technologies, the expectation for businesses to adapt for the long-term is here to stay. More than eight in 10 South African respondents (83%) agree they prefer to shop at stores that have both an in-person and online presence.
Additionally, 75% say they are more loyal to retailers that offer multiple payment options, and 77% say they would shop more frequently at small businesses if they were offered more diverse ways to pay.
“Businesses and retailers – both large and small – are faced with the challenge of ensuring fast, simple and secure payment options across channels as consumers increasingly want to shop and pay how they want. For those that are willing and able to adapt, this is an opportunity to build competitive advantage and a memorable customer experience,” notes Suzanne Morel, country manager at Mastercard South Africa.
Share