It’s no secret that the last decade, or even two, has significantly changed the way we handle money and make payments. However, the changes to the way we pay have gone from innovative new technology, optional to those who find it convenient, to a necessity to navigate in the new world.
In the time of COVID, with so much being done remotely or, at the least, with extreme caution, we’ve seen changes in payment methods.
1: A Change in Consumer Experience
People aren’t even taking the traditional routes that lead purchases and payments are made. Retail shopping in the traditional brick and mortar stores used to be seen as normal. In the times of the pandemic, it is now seen as a harsh necessity, require absolute caution and hesitation.
Many consumers have turned to solely online shopping to avoid contact with other people outside of their homes. This means that companies are going to have to adapt, switching to convenient online options, and altering the way they allow their customers to shop.
2: Cashless Economy
Now more than ever, despite how dependent people have been on credit and debit cards in the past, people are rejecting the traditional use of money to make a payment, using alternate options like cards and mobile contactless.
There has been a significant increase in how many people have signed up for mobile payments, with the age group of 16 to 34 nearing a 30% increase. People are finding it inconvenient and unsafe to exchange cash, or even swipe a card, and are turning to transferring money right from their mobile device.
3: Need for Security
As cringeworthy as it may be, the truth is that the recent crisis has made it easier for criminals to commit fraudulent behavior. These fraudsters have now been able to find new loopholes with the ways of transferring payments, making it more common for consumers to have their identity stolen.
What this means for payments is that banks are going to have to increase their security to make transactions more secure, or risk more individuals losing money due to their need for remote or contactless payments.
4: Mobile Wallets and Online Shopping
With the change of consumer experiences, as stated above, more companies have left their traditional shops and ventured into the world of online shopping. Since online purchases have seen such an increase in the time of COVID, moving to the internet may seem like the smartest choice.
However, companies need to be mindful of the competition online. We’re beginning to see the underlining start of competitions between competitors regarding additional fees and delivery charges that come with an online purchase. Big companies online, like Amazon, will have to alter their payment options and fees to stay ahead of struggling retailers.
5: Less ATM Transactions
People are using ATMs less to take out money. With the decrease in cash use and the coin shortage in some areas of the country, people don’t need to use ATMs to take out their funds. What does this mean for bank profits? What does this mean for the use of cash in the future? Perhaps not in 2021, but the future could see the disappearance of ATMs altogether.
The age of COVID-19 has considerably changed the way we make payments and handle transactions.
