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Wednesday, May 6, 2020

Paysafe finds growth in socially distant payments

Social distancing and working from home are having an impact on consumer buying behavior, according to a new study by Paysafe Group. "How COVID-19 is impacting payment preferences," published May 4, 2020, identified five key trends related to the global pandemic's impact on in-store and online shopping habits. The report is the newest edition of the company's Lost in Transaction series.

Daniel Kornitzer, chief business development officer at Paysafe, observed that emerging trends among North American consumers will likely become permanent. "With the rapid growth in eCommerce, the need for robust payment solutions for the card-not-present space is stronger than ever," he stated.

Paysafe researchers found that 49 percent of U.S. consumers expect to maintain their increased level of online shopping, even when municipalities reopen. While the sharp rise in ecommerce was originally driven by the need to replace in-store shopping, a growing market for specialty items also contributed to the surge, researchers found, with 46 percent of U.S. citizens and 33 percent of Canadians shopping for items they would not have needed before the crisis.

Contactless growth

Contagion fears have also prompted consumers to use digital wallets and contactless cards at the POS, according to the study. Sixty-three percent of Americans and Canadians who responded to the survey are using contactless, and 60 percent stated they will continue to use tap and go payment methods in the future. In-store usage of digital wallets is also on the rise, with 44 percent of Americans surveyed viewing Apple Pay and Google Pay as more secure than contactless cards due to biometric payment authentication, researchers noted.

"Despite the World Health Organisation stating that cash can be handled safely if consumers wash their hands thoroughly afterwards many stores are either strongly encouraging shoppers to avoid using cash if possible, or have banned using cash altogether," Paysafe researchers wrote. "Because of this, nearly half (48%) of consumers overall say that they are currently worried about using cash, and this figure exceeds 50% in the UK (53%), US (55%), and Canada (56%). At the other end of the spectrum, only slightly over one third (37%) of consumers in Austria say they have health concerns about continuing to use cash during COVID-19."

Report data indicated that U.S. consumers appear to be more loyal to cash than Canadians, but researchers expect to see continued growth in contactless payments. The Paysafe study found 65 percent of survey respondents believe contactless schemes are more convenient than cash; 56 percent indicated they are more comfortable using contactless cards now than a year ago.

"In the short term, as we continue to navigate the challenges of the current situation, consumers need access to secure and reliable traditional and alternative payment solutions to help them continue their daily lives as safely as possible," Kornitzer said.

A copy of Paysafe Group's report is available at: www.paysafe.com/blog/how-covid-19-is-impacting-consumer-payment-preferences/ . end of article

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