The rise of mobile payments in 2020

Smartphones are a ubiquitous part of everyday modern life being used from everything from emails to selfies to social media. Over the past few years there has been an increasing number of people using their smartphones not only to conduct their everyday banking via mobile apps but using them to make payments via mobile wallets such as Apple Pay and Google Pay.

The pandemic has seen many consumers prefer contactless and digital payment methods with fears around using physical payment methods such as cash or having to touch a Point-of-Sale (POS) device when entering a Chip and PIN payment. The rise of contactless card payments over the last decade has also meant that the experience of paying for something by tapping at the POS, whether by a card or phone, is a familiar process for many consumers.

Last month's UK Payment Markets 2021 report found that the number of people who had registered for mobile payments by the end of 2020 increased by three quarters in the last year to over 17 million people. This growth in mobile payment registrations saw over a quarter of all adults using mobile payments in 2020.

Similar to other new technologies, initial adoption is higher among the younger generation with half of 18?34 year-olds being registered for mobile payments. While the figures are lower, over one in ten people aged 65 or older have also registered for mobile payments, demonstrating that all age groups have begun to use this payment method.

Mobile payments are convenient for many people as they always have their phone on them and offer greater security benefits due to the requirement to use face ID or biometrics when authorising a payment. Mobile payments at the point-of-sale also allow contactless purchases above the £45 contactless limit. Both Apple and Google actively advertised this benefit during the pandemic which has likely further encouraged adoption.  

Another aspect of mobile payments is they can be used when shopping online or when using mobile apps such as Uber, Deliveroo, and Just Eat. The pandemic has seen many hospitality businesses such as pubs and restaurants encouraging their patrons to order via mobile apps when eating and dining at their venues. Many of these apps provide the option of paying via a mobile wallet, simplifying the payment process meaning patrons do not need to go through and enter their card details when paying each time.

With smartphones continuing to be important to everyday life in the UK and consumers becoming more comfortable with utilising mobile payment technology both in-store and online, mobile payments are likely to continue to grow over the next few years.

More insights into mobile payments and how we paid for things in 2020 can be found in a free summary of the key findings from UK Payment Markets, which can be downloaded here.

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The rise of mobile payments in 2020

27.07.21

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