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Contactless Payments continue to rise as cheques bounce to the margins

Findings from BOI Payment Acceptance (BOIPA) recent global and national surveys on consumers’ attitudes towards payments and businesses’ outlook are reflected in the Q1 2022 Payments Monitor from the Banking and Payment Federation Ireland (BPFI).

BPFI represents the banking, payments and fintech sector in Ireland. Their payment monitor has tracked payment behaviours and trends since 2016 using data from its members.

Findings from their tracker for Q1 re-asserts BOIPA’s findings, highlighting Irish shoppers to be one of the confident in their uptake of cashless payment options.

Cheque mate – Are cheques now a spent force?

The use of cheques continue to consistently fall and reached an all-time low in Q1 at 4.5 million, over a 60% drop when compared to the same period in 2016 and a decrease of 900,000 when compared to the previous quarter,

BOIPA’s research found cheques to be less popular with Irish people compared to our neighbours in the UK, with 30% of UK consumers claiming to use cheques, compared to only 23% of Irish shoppers, with the majority of these only using cheques as a payment option once a month or less.

With less cheques being cashed than ever before, online and mobile banking usage, along with direct debits continue to rise, translating into higher digital engagement with banking services. Almost 74% of bank customers said they use mobile banking 2-3 times a month with 27% using it once a day.

BPFI’s data revealed that online and mobile banking payment volumes grew by 13.2% year on year to 34.3 million payments in Q1 2022 and direct debit volumes increased by 4.4% to 35.5 million. Given the heightened increase in online and mobile banking, there is a real likelihood for them to overtake direct debits as a means of payments over the course of 2022.

Popularity of contactless payments and the rise of digital wallet usage

With 63% of Irish shoppers claiming that cashless payments are the preferred method of payment for shopping offline in BOIPA’s global survey (8% higher than the survey’s average), BPFI’s data on contactless transactions comes as no surprise. Quarterly contactless payment volumes continue to rise with 2.5 million payments per day in Q1 2022.

The results also show the heightened use of contactless payments compared to the same period before Covid restrictions were first implemented in mid-March 2020, with a 90% increase in the number of people tapping per transaction. The average contactless payment value increased to €16.20 from €15.72 a year earlier.

The growing popularity of digital wallets and wearable devices to make payments aligns with this increased use of contactless payments. In shops, 65% of people surveyed now use digital wallets with 38% of those using this payment method several times a day. 67% are using wallets online with 24% using this option several times a day.

A further 15% of participants who do not yet use virtual or mobile wallets claimed that they intend to use them in the near future.

Business benefit from general increase in cashless over cash transactions

The findings from the global survey on attitudes towards payments along with BPFI’s payment monitor results demonstrates consumers’ appetite for cash-alternative payment options.

97% say they use card or digital payments and the availability of cashless transaction options impacts their perception of businesses with customers believing a business accepting cash alternatives as being more modern (82%) and customer-centric (74%).

What does this payment shift mean for merchants?

Over half of businesses claimed that over 70% transactions were now cashless and, overall, the change has been viewed positively.

64% of businesses believe becoming more cashless has benefitted how they run their business. The reasons why this has helped included:

  • Being more secure and safer for staff than handling cash
  • Helping simplify administrative tasks and,
  • being more cost effective

This has left Irish businesses finely split on whether they would go completely cashless in the next decade.

About BOI Payment Acceptance (BOIPA)

BOI Payment Acceptance (BOIPA) is a marketing alliance between the Bank of Ireland and EVO Payments Inc. It brings together that Bank of Ireland’s understanding of what Irish businesses need and EVO’s expertise in creating innovative payment solutions.

About EVO Payments

EVO Payments, Inc. (NASDAQ: EVOP) is a leading payment technology and services provider. EVO offers an array of innovative, reliable, and secure payment solutions to merchants ranging from small and mid-size enterprises to multinational companies and organizations across the globe. As a fully integrated merchant acquirer and payment processor in over 50 markets and 150 currencies worldwide, EVO provides competitive solutions that promote business growth, increase customer loyalty, and enhance data security in the international markets it serves.