8 in 10 changed payments habits during pandemic

More than eight in ten consumers (86 per cent) say that their payments habits have changed since the start of the pandemic as adoption of digital and contactless methods rises.

A survey of 8,000 consumers from the US, UK, Canada, Germany, Austria, Bulgaria and Italy on behalf of payments platform PaySafe found that 59 per cent had tried a new payment method for the first time in past 12 months, with that number rising to 77 per cent of 18-24 year olds.

The key driver cited by respondents for adopting new payments methods was due to being unable to make in-person payments (33 per cent), but wanting to track spending more closely (26 per cent) and concerns over fraud (25 per cent) also emerged as key trends.

In terms of awareness, more than a third (38 per cent) of consumers said they are now more informed of the wide range of different payment methods available to them than they were prior to the pandemic, and almost a third (31 per cent) are now more likely to use an alternative payment method when making an online purchase, rather than just automatically reaching for their credit or debit card.

However, card payments continue to be the dominant online payment method, with more than half of global consumers having used a debit (54 per cent) or credit (51 per cent) card to complete a transaction in the past month.

Against this backdrop, digital wallets are emerging as the most popular alternative payment method with 43 per cent of respondents using them globally in the last month and the number rising across Europe with 47 per cent of respondents in the UK.

Overall, 32 per cent of consumers globally are using digital wallets more frequently than prior to the pandemic, 13 per cent are using prepaid cards more and 8 per cent are using online cash, or eCash, solutions, more regularly.

The research also reveals that having a choice of payments at the online checkout has been a key differentiator during the pandemic, with more than half (53 per cent) of all consumers agreeing they would not return if they suffered a poor experience or lack of choice.

Although a large proportion of consumers (63 per cent) seek tighter payment security measures, the number of consumers prioritising convenience has increased by 110 per cent in the past 12 months.

When it comes to in-store shopping, 43 per cent of consumers also noticed which retailers made efforts to upgrade their checkout in reaction to the pandemic, with 28 per cent saying that businesses did not react quickly enough to make it safer.
However, nearly half (48 per cent) of consumers reveal they are planning to shop in stores as frequently as they did pre-COVID-19, highlighting the importance of an updated checkout for offline retailers.

And, indicating a perhaps surprising comeback for cash after the pandemic, 50 per cent of consumers plan to make at least 25 per cent of their transactions using cash in the future.

Commenting on the findings, Philip McHugh, chief executive at Paysafe, said: “Consumers have adapted and gotten to grips with alternative payment methods over the last year, partly because they had to due to the pandemic. Through our ongoing research into payment trends, we continue to witness that COVID-19 has been a real accelerator in the adoption of alternative payment methods and choice is everything. The good news is, it’s now easier than ever for merchants to integrate into a payments platform and access a huge range of payments methods via one connection.”

He added: “Concerns around payments security have also been a constant theme coming through in our research and consumers are increasingly alert to the threat of cyber risks, so it’s not just about offering choice, it’s also about ensuring peace of mind from a security standpoint, coupled with a frictionless experience.”

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