The COVID-19 pandemic drove the adoption of many new technologies in 2020. While the first thing that comes to mind for most people is probably video chatting, contactless features also became essential parts of many businesses. Specifically, touchless payments with a smartphone give users a way to pay for their goods without putting their fingers on high-touch surfaces like a checkout kiosk.
Although touchless payment technology has been around for several years, consumers finally started to adopt it en masse last year. Thanks to the pandemic, use of the technology grew by a whopping 29 percent last year according to data from eMarketer.
Part of the reason for mobile payments not catching on sooner is that many retailers, especially in the U.S., were slow to add the technology to their checkout lines. The pandemic forced many businesses to stop procrastinating and upgrade to touchless equipment. Not only does this let them offer customers a more hygienic way to check out, it’s also a great way for businesses to show that they care.
Clearly, the increase in business adoption has played a role in helping mobile payment technology gain popularity.
With its annual growth just under 30 percent, the touch-free payments market saw transactions from 92.3 million U.S. customers last year. According to eMarketer, those customers are ages 14 and older and made a mobile payment at least once during the year. The firm projects that mobile payments will surpass half of all smartphone users by 2025.
Over the next few years, the technology’s growth is likely to slow down a bit after its pandemic spike. Even so, the increased adoption isn’t expected to be a fad. Instead, it served as an important boost for touchless payments that helped it gain momentum.
Analysts believe that the touch-free payment industry will be worth $2.4 trillion in 2021. That’s partially because consumers are spending more each year with touchless payments. According to eMarketer, consumers spent just under $2,000 last year using mobile payments in 2020.
It should come as no surprise that the mobile payments industry is led by a few key players. In the U.S., Apple Pay holds a demanding lead for the top spot with 43.9 million users.
However, the second-place mobile payments provider is a bit unexpected. Starbucks claims the title with 31.2 million users. That’s a highly impressive feat for a single company. It highlights not only the power of pushing mobile payments technology to consumers but also the demographic that Starbucks serves.
Following the coffee giant is Google Pay with 25 million users. It’s worth noting that the mobile wallet is expected to add 10 million new users over the next few years.
Samsung Pay is the final service worth noting and claims 16.3 million users. However, it is also the least exciting of the group since its growth has stagnated in recent years. It’s expected to add just two million users in the coming years.
Overall, the future of touch-free payments looks bright. While the pandemic has been horrible for many reasons, we have it to thank for the widespread adoption of this tech.