Tide may be turning for contactless payments

Contactless payments may be tough to sell consumers, but that hasn't stopped Visa from trying. The official payments services partner of the National Football League, Visa enabled half of the concession stands at this year's Super Bowl to accept tap-and-go payments. And as previously reported in "Visa, NFL team up for payments at Super Bowl LIII," under The Green Sheet's Breaking Industry News, Visa is promising to expand the capability throughout NFL stadiums under terms of a new agreement extending its NFL partnership through the 2025 football season.

Visa has been promoting contactless payments for more than 20 years. Some of the earliest tests of contactless payments occurred in sports stadiums. They relied on payment fobs that employed near-field communications technologies to support tap-and-go payments in much the same way that Apple Pay and similar smartphone-based payment apps work today.

A notable share of merchants are positioned to accept contactless payments. A survey of small and mid-sized businesses last year by Paysafe found 37 percent have technology in place to accept contactless payments, and another 20 percent plan to be in a positon to accept contactless payments within the next two years.

Consumer adoption lagging

But consumer adoption to date has been lackluster. An October 2018 survey by RootMetrics, which tracks mobile trends, revealed that while many consumers were using their mobile devices to search for purchases, nearly two in four consumers (37 percent) don't use mobile payment apps because they feel using cash or cards is easier. The survey – The Lifestyles of Mobile Consumers – revealed that nearly as many consumers (36 percent) had security concerns that deterred their use of Apple Pay and similar mobile payment options.

Sarah Grotto, director of the debit advisory service at Mercator Advisory Group, is optimistic the tide will turn for contactless payments. Half of consumers recently surveyed by Mercator reported using smartphone-based payments in the past year, she said. And she predicted more will take the plunge with a little encouragement from card issuers. Seventy percent of surveyed consumers said they would use mobile payments more often if they automatically received rewards or discounts for doing so.

"Card issuers cannot afford to leave changing consumer payment preferences unaddressed – banks face a choice between introducing touch-and-go or being seen as completely out of touch," Grotto recently wrote.

Visa appears to be on board. In describing its work with the NFL Visa said it would expand its contactless program across NFL events domestically, and will provide "added benefits specifically for Visa cardholders" making contactless payments when purchasing tickets for or items while attending those events.

Editor's Note:

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