Australia has the highest number of people who understand and make contactless payments in the world.
A 2015 survey by RF Intelligence Group, called ‘Global Payments Evaluation Study’, based on 32,000 respondents in 16 countries found that 66% of Australians are aware that they own a contactless payment card and 5% have made a contactless transaction. By contrast, just 14% of Americans own a contactless card and only 1% have used one for a payment.
Interestingly, countries nearby such as Singapore and New Zealand have some of the highest contactless payment system awareness and usage statistics globally.
Consumers are following Australia’s lead across the world with both awareness and ownership of contactless payment cards rising.
In Australia, more than one in two transactions under $100 are made using contactless technology, often with Visa PayWave or MasterCard PayPass and are used to pay for everyday lower value items or groceries.
Why is contactless so popular?
One of the biggest reasons contactless payments have spread so successfully across Australia is because the tap-and-go infrastructure is established and there are lots of places you can make contactless payments. The market in Australia is developed.
Big chains like Woolworths and Coles have installed contactless payment systems and the evidence indicates that where contactless is available, consumers will use it.
Smaller businesses like café’s are using tap-and-go terminals because they offer customers the ability to pay that way with no minimum spend – ideal for a $3.50 coffee. Customers are increasingly using contactless methods as an alternative to cash.
The new card machines have proved popular at taxis, fast-food stores, newsagents, supermarkets, pharmacies and vending machine operators.
How will this impact
Because of the existing contactless payment infrastructure in Australia, new entrants into the market, like Apple Pay may find Australia a more difficult market to crack. Apple has found it easier to enter the US and UK market because the tap-and-go system is not as well established.
The functionality that new systems are bringing has been available in Australia for nearly two years now. Several Australian banks and merchant facility providers also offer smartphone-based card readers. In the UK, these systems are not so established which is one reason why most UK banks have agreed to partner with Apple Pay.
Australia has been quicker to adopt contactless payments than the UK and US, partly because Australia’s major financial institutions and big supermarkets have backed the new payment systems and this makes them widely available for customers to use.
In the last four years, Australia has seen the arrival of banking apps for wearable devices, payment authentication via fingerprints and cardless cash.
A study from March 2015 found that the demand for mobile and digital services is revolutionising the way Australian businesses pay for goods. 45% accepted payment via PayPal or digital wallets.
In 2014, Westpac found that 60% of all debit card transactions are contactless with the major four banks. In 2016 the estimated value of all transactions made by contactless mobile payments in Australia will be almost $3billion, figures that will increase with the adoption of more NFC-enabled smartphones.
Australia is part of a big Asia-Pacific market for new payment technologies, motivating brands and financial institutions to give customers the advanced contactless digital and mobile payment services that the figures show they are clearly demanding.