Italy’s cash-dependent payments market requires products and services tailored to consumer perceptions and attitudes.
The Italian consumer payments market is unique in Western Europe: consumers rely very heavily on cash to the exclusion of payment cards. Italy has the second-lowest penetration of traditional payment cards (debit, credit, and charge) in the region, ahead of only France. Consumers in Italy do not use their debit or credit cards often at the POS, and particularly not for low-value transactions, preferring to use cash. This preference is so pronounced that the government has legislated on two separate occasions to discourage cash use at the POS in order to recover tax revenue lost to untraceable cash transactions.
Italy also has the highest level of prepaid card penetration of any country globally, with 74% of Italian consumers possessing a prepaid card according to our 2015 Consumer Payments Insight Survey. The single biggest driver of prepaid card acquisition for Italians is making purchases online, and more specifically because they are seen as secure methods of transacting online as compared with other types of card. Since cash cannot be conveniently used online, prepaid cards came to prominence as an ideal means of supplementing regular cash usage.
Italian consumers’ payment tool preferences – and the reasons behind them – illustrate the unique needs of this market, and require that products and services be tailored to those needs. To be successful in the market, tools need to cover use-cases that cash cannot – such as remote P2P – while emphasizing security and convenience.
By Samuel Murrant, Senior Consumer Payments Analyst