23 Jun 2020
Posted in Banking
Italian payments industry set to move away from cash dominance as consumers look for safer methods, says GlobalData
With the COVID-19 unlikely to cease in the near future and the lockdown still continuing, the consumers in Italy are opting to shift away from cash payments to mobile and online payments, which are supposed to be safer modes of payments, says GlobalData, a leading data and analytics company.
GlobalData has revised its forecasts for payment card transaction value and volume for the next four years. It now forecasts a contraction in the market in 2020, but it is set to return to growth in 2021, but not to previous levels. However, GlobalData expects Italy’s e-commerce market to grow at an annual rate of 19.1% in 2020 – compared to its previous estimate of 13.7%. Forecasts for growth in the M-commerce market have also been revised up for every year in the 2020-23 forecast periods.
Ravi Sharma, Banking and Payments Lead Analyst at GlobalData, comments: “The drop in the overall consumer spending during the pandemic has been offset by a rise in online spending, as wary consumers are staying at home and using the online channels for payments and hence, put themselves in a lesser risk or risk-free zone. Online payments solutions, such as PayPal, e-Postepay, Amazon Pay, Masterpass, and Visa Checkout, as well as online processors and gateways, stand to benefit from the prevailing trend.”
Cash has historically been the preferred method of payments in Italy, accounting for 78.5% of volume in 2019. However, the outbreak is changing that and new behaviors will be learned by consumers.
Sharma concludes: “The use of mobile phones for purchase of essential commodities such as food and medicine is expected to become even more widespread in Italy, driving a rise in the use of mobile wallets. Mobile wallets are probably the safest way of transacting in stores, as consumers do not need to come into contact with terminals.”