On the road to cashless payments
Cashless payments definition and evolution
According to the Cambridge Dictionary, “cashless” describes a “system in which people pay for things by using bank cards, moving money over the internet, etc. rather than using cash in the form of coins and notes”.
What is interesting about this definition is the vagueness and lack of information around what actually replaces the cash itself. For a vast majority, cashless means the replacement of cash by card payments. Truth is that nowadays and in some regions of the world, card payments are being outshined by other forms of digital payments.
Cashless payments have evolved a lot over the years. It started with simple cheques, and now we are witnessing an array of new cashless payment methods: wallets, wearables, Google Pay, Apple Pay, Android Pay, QR codes, etc.
However, cashless payments do not have the same impact everywhere in the world. Each region has its own preferences when it comes to payments.
Cashless payments around the world
According to Pymnts.com, Africa and East Africa specifically are experiencing a quiet cashless payments revolution driven by mobile money services and a growing mobile penetration. As of today, nearly 200 million consumers subscribed to mobile money services, after the launch of M-Pesa in 2007. RBR research shows that by 2025, two-thirds of the population will have a smartphone which leads to the path of cashless payments becoming more and more a standard.
In South Africa, the number of cashless payments – including card payments, keep increasing over the years. Despite this increase, a recent research from Deloitte shows that cash usage continues to grow too (mainly due to a trust issue of individuals who keep withdrawing all their salaries as soon as they get paid).
As stated before, not all regions have the same contactless journey. And sometimes the difference is highly notable even between two neighbouring countries, such as Canada and the USA. Americans are more reluctant to the use of contactless payments, compared to their fellow neighbours.
Covid-19 impact on cashless payments
With 15% penetration rate worldwide, contactless still has a huge potential for further growth. Highlighted by a recent RBR report, Global Payment Cards Data and Forecasts to 2024, Covid-19 accelerated the pace of change to significantly increase the share of contactless payments. For example, in South Africa, it increased 4 times more.
Covid-19 has accelerated the adoption overall, from a user’s perspective they are keener to use contactless, aligned with social distancing measures. Institutions, governments and central banks have facilitated that too, by increasing the authorized amount for contactless payments. As a matter of fact, in many countries in the world, contactless payments limits have increased since April 2020.
The pandemic has highlighted the benefits of contactless payments to all – whether it is in terms of security, speed, simplicity, or even sanitary measures – we can see that globally, the population has experienced the convenience of cashless means of payment. This initiative, driven by many institutions and central banks globally, showed a concrete example and a solid alternative to cash, for the ones still doubting.
This is obviously an ongoing journey: it is very important to keep educating people around the benefits of cashless payment means.
Cashless payments’ journey with HPS
HPS has launched many initiatives, enabling their customers to deliver simple, seamless and secure cashless solutions.
Whether it is with a QR code or mobile payment interoperable solution, with the launch of Apple Pay in Japan or building a large-scale acquiring payment infrastructure in Indonesia – HPS always drives innovative payment solutions that matters to the market.
To know more about HPS customer’s accomplishments, please contact email@example.com