- A survey conducted by Kantar on behalf of Mastercard shows that cardholders love the ease and speed of contactless technology
- Growing in-store merchant acceptance and consumer education about security aspects of the technology are keys to accelerating adoption throughout the region
Miami, May 27, 2019 – Contactless technology is quickly catching on in Latin America & Caribbean as consumers embrace it as an easy and fast way to pay. Contactless payments, which allow consumers to make purchases nearly 10 times faster than the traditional way, involves simply holding a card or smartphone up to a payment reader for the transaction to proceed. The ecosystem is evolving. Around the world, most payments in Australia and Poland are already contactless, more than half in Asia Pacific, and half of all electronic payment transactions are contactless Europe.
In Latin America & Caribbean, there’s plenty of room for growth as consumers still rely on cash for payments, even though it is a cumbersome and potentially unsafe method. However, a contactless transformation is underway. A recent survey by Mastercard and Kantar, a market research firm, found that awareness of the benefits of contactless payments is increasing in the region. On average, 50% of consumers in Latin America & Caribbean are familiar with this payment method. Specifically, the awareness is highest in Brazil, Chile and Costa Rica, at 7 out of 10 respondents. In Colombia and Mexico, half of the respondents know about contactless, while 3 out of 10 consumers in Argentina and Panama indicated an awareness, the survey found.
Additionally, the results show that the availability of the technology is a main driver of increased awareness — and the basis for growth and adoption of contactless. Chile and Costa Rica, for example, have the highest proportion of contactless cardholders in Latin America and, hence, the highest awareness. In Brazil and Colombia, most consumers understand the full realm of contactless, from cards to e-wallets like Apple Pay and wearables such as bracelets and watches.
Now more than ever, consumers expect frictionless payments, and contactless delivers. The growing rate of recognition and understanding of this payment technology stems from efforts in these and other markets, to promote the use of contactless cards in the public transportation system. In more than 80 cities worldwide, consumers can already use contactless devices (card, mobile, or wearable) as a ticket in public transport systems.
Repeat use has helped cardholders understand the benefits of contactless, which are led by its speed and ease-of-use, according to the survey. With just a tap and without sacrificing security, payments occur much faster than by fumbling with cash or dipping a card in a reader. Moreover, the technology reduces lines in stores, helping to improve the entire shopping experience for consumers and retailers alike. It’s a simpler way to pay that is saving time for both sides.
There are opportunities to widen the use of contactless. More information about the technology and acceptance of contactless payments is needed, according to the findings of the survey.
Another opportunity is to increase education related to its security. While consumers in many parts of the world are turning to contactless because the card never leaves their hand, reducing the chance of card cloning and fraud, LAC cardholders have yet to become fully aware of the improved security that comes with this technology.
Cardholders are not aware that the level of security of a contactless transaction is the same of EMV/ Chip card with a dynamic element that makes each transaction unique with the added benefit of the card not leaving the hand of the consumer. Clearly to accelerate adoption consumers need to understand the benefits and security contactless payment provides.
“The industry is coming together to make contactless the universal easy way to pay. With surveys like this one, Mastercard is able to understand the challenges and barriers that it must solve to promote the adoption of contactless technology so that more and more consumers can really benefit from a more seamless payment experience in their day-to-day lives,” said Rodolfo Duran, Vice-President, Business Development, Mastercard LAC.
Advertising of contactless is helping to raise awareness of how it works and its benefits including security aspects of technology. The study found that most consumers agree that the best phrase to describe the contactless payment method is “fast, easy and safe.”
MasterCard (NYSE: MA), is a technology company within the global payment industry. Our global payment processing network connects consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. Mastercard products and solutions make the day-to-day business activities, such as shopping, traveling, running a business and managing finances, something easier, safer and more efficient for everyone. Follow us on Twitter @MasterCardLAC, join the discussion on the Blog and subscribe to receive the latest news about the Engagement Bureau.