Smartphone payments soar as digital wallets gain traction

When you are lining up at the supermarket checkout, carefully keeping a distance of 1.5m from others in the queue, have you noticed more people paying by waving their phone at the terminal?

Figures from banks show the use of digital wallets – smartphones or wearable devices that can make payments – is soaring.

ANZ Bank’s digital-wallet transactions surged more than 50 per cent in the six months to July 31, compared with the same period last year, while tap-and-go payments on plastic cards fell 2 per cent.

A survey from Finder.com last week found the share of Australians using digital wallets or wearable devices had almost doubled since March, to 13 per cent, and CBA reported fast growth in digital wallet transactions earlier in the year.

Mastercard has also seen signs that digital wallets are catching on fast: it says about one in four tap-and-go payments are made on a device.

The trend has been a long time coming. Banks and technology companies have offered digital wallets for years, without gaining much mainstream appeal.

Some of the recent growth is because all four of the big banks now offer these types of digital payment methods, after a 2016 fight between three of them and technology giant Apple led to delays in rolling them out.

However, a desire to use contact-free payment methods during the coronavirus pandemic has added fuel to the fire.

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Source: Smartphone payments soar as digital wallets gain traction