Digital wallets poised to overtake contactless cards as instore payment of choice in Australia

Digital wallets poised to overtake contactless cards as instore payment of choice in Australia

News
May 19, 2021 by J.D. Smith
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When shopping instore, Aussies are increasingly choosing digital wallets as their preferred way to pay compared to tapping a card, according to latest figures from CBA. New figures from the bank highlight the growing popularity of digital wallets and the likelihood for them to become the most popular contactless way to pay in-store by the
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When shopping instore, Aussies are increasingly choosing digital wallets as their preferred way to pay compared to tapping a card, according to latest figures from CBA.

New figures from the bank highlight the growing popularity of digital wallets and the likelihood for them to become the most popular contactless way to pay in-store by the end of the year, if current trends continue.

Between March 2020 and March 2021 the number of monthly digital wallet transactions – where consumers used a smartphone or smartwatch that include CBA tap-and-pay, Google Pay, Samsung Pay, Apple Pay, Fitbit Pay, and Garmin Pay – increased 90%, with the number of transactions rising from 36 million to 68 million.

Over the same period, the total dollar value of digital wallet transactions more than doubled, with the value of monthly transactions rising to $2.1 billion, up from $1 billion.

As of March 2021, more than 40% of the bank’s combined debit and credit card contactless transaction count was via a digital wallet.

CBA’s executive general manager for everyday banking, Kate Crous, says: “We know customers continue to value the ease and security of digital wallets and over the last year we have seen Covid play a part in accelerating the trend. As more customers use digital wallets, they are also using more features in the CommBank app to monitor and manage their spending.”

The bank’s figures also revealed that many Australians have started making higher value purchases via their digital wallets with the average dollar value of a digital wallet transaction increasing from $41 to $44 (credit) and $26 to $29 (debit) over the past 12 months.

“People mostly use digital wallets to pay for everyday expenses such as public transport, groceries, food and beverage, retail shopping and petrol. As customers are becoming more comfortable with paying this way, we have seen the average amount being spent using digital wallets continue to rise, both for credit and debit purchases on average, over the year.”

Based on the current trends, Crous believes that it is likely that digital wallets will be the most popular contactless way to pay by the end of the year.

“Over the last couple of years we have seen a 10 per cent increase in digitally active customers, up to 7.5 million. Given this increasing move towards digital, we expect the growth of digital payments to keep rising and expect by the end of this year, that every second contactless in-store payment will be made using a digital wallet.”