September 27, 2023 Do Contactless Payments Influence Customer Behaviour?

Contactless payments now allow up to £100, influenced by COVID-19. The shift from cash to tap-and-go has changed customer behaviour.

In recent years, contactless payments have become something that we have all got used to. They have gone from being something that was only used for very small purchases to something which can now cost up £100 in the UK. It cannot be denied that the COVID-19 pandemic has played a large part in this, as contactless payments were not only convenient but more hygienic too.

By 2018, the majority of everyday payments were still made in cash, and ATMs had regular visitors using them multiple times a week. Now, the use of cash is declining rapidly in favour of card payments but even these are generally now being made by tapping the contactless icon at the top of the payment terminal rather than inserting the card and typing in a PIN.

It stands to reason that this new form of payment has changed customer attitudes and how they behave. It is quicker and easier and therefore fits in much better with a society that is becoming increasingly fast paced. We all want everything immediately, and contactless payments mean that we barely even have to stop moving to make them.

Here, Cema Vending take a look at what contactless payments are now doing for the world, how they are influencing our shopping habits and whether this is a trend that is here to stay.

Consumer trends

When the COVID pandemic hit in 2020, a lot of things changed, including consumer trends. Online sales all saw a boom and contactless payments became the preferred norm as people tried to avoid spreading the virus. To accommodate this, the UK government pushed up the limit on contactless spending, and consumers soon found that their cards, watches and phones were a faster and simpler way for them to pay.

This speed and efficiency is now something that we have come to expect wherever we go, and in recent studies, two thirds of consumers across the world said that they would switch to a business that offered contactless payments over somewhere that they already use that does not. This has meant that many more businesses have adapt to the contactless way of life in order to prevent consumers voting with their feet.

Impulse buying

Contactless payments have definitely driven a trend for impulse buying. It is not just the cashless elements of the purchase, but also the immediacy of the tap and go culture. It means that there is less thinking time behind a purchase, which means less time to talk yourself out of it. That has meant that the buying of small items in shops or even food and drink when out and about has increased, as all that is needed is a simple swipe and consumers and not noticing the money disappearing from their wallets.

Spending amounts

There have also been a number of studies into how much people are prepared to spend based on the payment methods that are available to them. It is believed that contactless payments have promoted increased spending and an increased use of debt, such as overdrafts. As many as 54% of people surveyed have stated that they would like to see the current contactless limit of £100 increased again in order to make their shopping experience yet more convenient.

Vending machines

Vending machines were once something that would accept the correct coins and turned something that should have added convenience and made it into a nuisance as small children begged for snacks when mum had no change in her purse or commuters stamped their feet in anger when another coin was rejected.

However, contactless technology has saved the vending machine and made it something that is popping up in more and more places.  You can now find a vending machine in every leisure centre, train station and workplace around the country because of the new convenient way to pay.

When a vending machine is kitted out with contactless technology there are no barriers to using it, and so they have once again become a great way to grab a drink or snack on the go and are proving to be very profitable for those who install them.

This is because they are not only being used more frequently, but the spend each time is increasing. Users are no longer limited by the change that they have in their pockets, and so they are buying what they want and not simply what they have the cash for.

Safety

Before the pandemic, the contactless limit remained low due to worries about fraud. However, when the lockdowns and social distancing pushed that limit up, less people seemed to be concerned as it now offered a different form of safety. It seems that this desire for cleanliness and safety from others has become greater than the worries of other people abusing your card.

This has been helped by an increase in security by the banks, who are not much quicker at spotting fraudulent use of a card and refunding anything that has been lost.

Futureproofing

Many businesses are now seeing contactless technology as a way of futureproofing their businesses. With this now seeming to be the preferred method of payment for many, those businesses and pieces of equipment that do not offer it are likely to suffer, if not now, then at some point in the future.

The speed at which we were thrown into lockdowns shows how quickly the world is now capable of changing, and so making sure you are contactless ready in as many areas as possible means that you are in a better position to protect yourself from the changes that the future might throw your way.

Contactless payments have revolutionised the way that we pay, and this shows absolutely no signs of going away. Whilst cash still has its place in society, more and more places are embracing and adopting contactless technology in order to move with the times and meet the growing customer expectations to be able to swipe and go wherever they go and whatever they buy.

Subscribe to Industry Today