What’s next? New study reveals trends in the European payments landscape post-pandemic

  • New research by Payments Europe reveals trends and insights in the European payments landscape
  • Cards continue to be the preferred method of payment for Europeans while other new electronic payment options are on the rise
  • Contactless card payments were the most widely used payment method in stores over the last year
  • Instant payments are becoming increasingly widespread, but consumers and merchants recognise the risks

Brussels, 1 December 2021 – A new and independent study by Payments Europe ‘The evolution of the European payments market: From cash to digital, what do Europeans want?’ shows that new trends have emerged post-pandemic regarding the payment’s behaviour of consumers and merchants in Europe.

According to the report, Europeans have increasingly moved to using digital methods of payments, with 8 in 10 in-store transactions being electronic in 2021. Interestingly, over 2 in 3 users (67% of consumers, 70% of merchants) want this trend to evolve even further and noted that they welcome government initiatives to encouragethe use and acceptance ofelectronic payments.

Board member of Payments Europe, Hendrik Frank from Deutsche Kreditbank AG, explains: “Since 2019, cash payments have been declining in Europe. The Covid-19 pandemic clearly accelerated the trend towards the use of electronic payments, and more specifically towards the use of contactless card payments. Our study found that contactless payments were the most widely used payment method in stores over the past 12 months with 25% of all transactions. A majority of European consumers would feel comfortable raising contactless limits to up to €150 per transaction.”

With consumers using more and more electronic payment methods, merchants have seen that card payments are now accounting for more than half of their monthly turnover. The research investigated this trend and found that cards best respond to consumers’ needs when making payments: the online and mobile functionality, the security of funds, as well as the convenience cards bring. From a merchant perspective, the study found that 4 in 5 merchants also highly value the security cards bring, and more than 90% of European merchants believe that the benefits brought by card payments outweigh any costs associated with it.

The European payments market is becoming increasingly diverse as there are more payment options available than ever. The research found that both consumers (88%) and merchants (76%) are happy with the available solutions. Although physical cards remain the preferred payment method for both consumers and merchants, mobile cards, mobile instant and BNPL (Buy-Now-Pay-Later) are significantly on the rise.

Board member of Payments Europe, Michael Hoffman from Card Payments Sweden, says: “While cards are still the most used and liked product in Europe for in-store payments, the survey also reveals interesting trends regarding more recently introduced ways of paying: it is expected that Buy-Now-Pay-Later (BNPL) options will triple over the next 12 months and that the use of instant payments will double over the next year.”

European consumers feel that instant payments are widely available, particularly for online purchases and person-to-person payments. Almost half of consumers believe it is available for in-store payments. However, the study shows that 89% of consumers in Europe believe there are risks linked to using instant payments. And this is also the case for merchants: while 9 out of 10 merchants said they are satisfied with the current features of instant transfers, 8 out of 10 also believe this payment option comes with a higher risk of failed transactions at the point of sale.

Payments Europe produced this report to better understand the payments landscape post-pandemic and to evaluate the preferences of both consumers and merchants. The research aims to demonstrate trends and insights established over the past 12 months that are likely to impact payment’s behaviour in the future.

About Payments Europe

Payments Europe is an association of global and European card-based payment solutions providers created to strengthen the voice of the industry. Our mission is to promote a better understanding of the complexity of card-based payments and the inherent value it brings to society.

We support a vibrant, innovative, and competitive European payments market, that is based on a balanced regulatory framework and that puts consumers and consumer protection at the heart of everything.

Payments Europe’s members are card issuers, card acquirers, card schemes and other stakeholders that offer card-based payment solutions, active throughout Europe.

More info, here: www.paymentseurope.eu or @PaymentsEurope.

Notes to the editors – research methodology:

The report ‘The evolution of the European payments market: From cash to digital, what do Europeans want?’ is based on an independent study commissioned by Payments Europe and conducted by FTI Consulting from 9th to 21st July 2021. The survey was completed by 3,223 consumers living in France (544), Germany (539), Italy (530), Spain (540), Sweden (538) and Poland (532) and by 680 merchants working in retail both online and offline in France (109), Germany (110), Italy (110), Spain (110), Sweden (106) and Poland (103).