In-Store Payments By Digital Wallet In 2020 Surpassed Cash For First Time

Spurred by the pandemic, electronic payments are becoming dominant. JL

Liz Kiesche reports in Seeking Alpha:

For the first time, payments using mobile digital wallets overtook cash payments on in-store purchases on a global basis last year. Cash usage dropped 10% in 2020 to account for only one-fifth of all face-to-face payments worldwide; use of cash for in-store payments fell by half  or more in Canada, the U.K., France, Norway, Sweden, and Australia. Cash in the U.S. made $1T of store payments last year, down from $1.4T in 2019. The Asia-Pacific region leads in the use mobile wallets, with 40% of in-store payments.

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• In the year of the pandemic, consumers are pulling out their digital wallets more often than they are physical wallets when they pay in store, according to a FIS study.
• For the first time, payments using mobile digital wallets overtook cash payments on in-store purchases on a global basis last year.
• "The global pandemic has brought a cashless future closer on the horizon," said Jim Johnson, head of Merchant Solutions at FIS.
• Among insights from the study:
• Cash usage dropped 10 percentage points in 2020 to account for only one-fifth of all face-to-face payments worldwide; use of cash for in-store payments fell by half  or more in Canada, the U.K., France, Norway, Sweden, and Australia.
• Cash payments in the U.S. made up $1T of store payments last year, down from $1.4T in 2019.
• The Asia-Pacific region leads in the use mobile wallets, with about 40% of in-store payments in that region being conducted through contactless payments.
• Use of mobile wallets accelerated across all regions in 2020 and now accounts for about 10% of payment methods in North America, 8% in Middle-East-Africa, 7% in Europe, and 6% in Latin America.
• The study projects that by 2024, cash will make up less than 10% of in-store payments in the U.S. and just 13% of payments worldwide. Digital wallets are expected to account for more than 33% of all in-store payments worldwide and 16% of all in-store payments in the U.S.
• Total ecommerce spending jumped 19% last year to $4.6T in value, the biggest increase in five years, the study found. It could grow to $7.3T by 2024.
• Gobally, usage of digital wallet-based ecommerce transactions rose 7% in 2020; by 2024 digital wallets will account for more than half of all ecommerce payments worldwide, the study predicts.
• Adoption of buy-now-pay-later transaction methods continues to rise rapidly in Europe and North America and is expected to double by 2024.
• Digital wallet companies include Apple (NASDAQ:AAPL), Google (NASDAQ:GOOG), Samsung (OTC:SSNLF), PayPal (NASDAQ:PYPL), Square (NYSE:SQ), Amazon (NASDAQ:AMZN), Adyen (OTCPK:ADYEY), Facebook (NASDAQ:FB). AAPL, GOOG, PYPL, AMZN, and SQ all outpaced the S&P 500 in in the past year: