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Data for today’s episode is provided by Mercator Advisory Group’s report –COVID-19: The Power Behind Contactless
How Many Contactless Debit Cards Are in Circulation?
- Mercator estimates that Visa, the brand on 72% of U.S. debit cards, has 93 million contactless debit cards in the U.S.
- Contactless debit will increase as the big banks put more contactless cards in the market and as smaller financial institutions prioritize the investment.
- Another indication that contactless debit will increase is merchant acceptance.
- When EMV liability shift kicked off in 2015, the EMV upgrade included contactless enablement; however, many merchants didn’t turn the feature on at the time.
- Visa reports 80 of the largest 100 merchants accept contactless cards, resulting in over 60% of in-person card transactions taking place at a contactless-enabled merchant.
- That is not to say that the transaction is in fact contactless, simply that the merchant’s technology is in place.
- In addition to merchants, cities like NYC, Chicago, and Miami have launched open-loop contactless payment systems for public transit.
COVID-19 has created consumer interest and use of contact-free payment experiences as fear of infection from surfaces, including a point-of-sale (POS) device, drives new behaviors. While reports and surveys proclaim cardholders’ interest in contactless technology, the actual number of contactless debit transactions authorized on a contactless card or mobile app remains elusive. This report, COVID-19: The Power Behind Contactless, considers the available market data and Mercator Advisory Group research to better understand the level of contactless payment activity and the degree to which COVID-19 is affecting its growth.
“The onset of the coronavirus created the perfect storm of events that is driving awareness more quickly than all the promotional activities have to date. Cardholders’ wellbeing is the incentive to adopt a new payment method. More consumers are now aware of the contactless capabilities they have on their debit card, which is driving new users in addition to increased use by current users,” comments Sarah Grotta, Director, Debit and Alternative Products Advisory Service at Mercator Advisory Group and author of the report.