According to a survey of more than 1,350 customers and 350 merchants, 75% of Millennials and 70% of Gen Z shoppers said they were satisfied with contactless payments. Per the report released by payments company Ingenico Group and commerce platform FreedomPay, 65% of Gen Z consumers think that contactless payments are a "must have" for merchants.
The report also found that 84% of businesses accept debit or credit card EMV contactless payment options, but only 37% of consumers are aware of the option. About a third of survey respondents under 35 years old anticipate that all stores will go cashless in the next five years.
The report also looked into loyalty programs, noting that 70% of consumers want to earn or redeem rewards without providing sensitive information, and 87% of consumers and merchants cite security as a top attribute when picking a payment method.
Retailers, including J.C. Penney, Target and Amazon, have been investing in contactless payments, with varying levels of success. Going contactless within five years may sound like a stretch to some, but a report from London-based research firm RBR predicts that global payments will grow to $45.2 trillion by 2023, in part thanks to the popularity of contactless payments.
Overall, consumers appear to favor innovation. A 2019 NRF report indicated that 80% of shoppers felt that technology and innovation had improved their online shopping experience; 66% said they felt the same about shopping in-store, which may bode well for contactless payments.
Ingenico's report, however, noted that 80% of respondents said they bought goods of $25 or less with cash, adding that ease of use may be a factor behind slow adoption. Whether shoppers are aware that the technology is in a given store is another concern. According to a 2019 report from Kearney, three-fourths of shoppers are aware of new retail tech features, but only one-third are experiencing them in stores.
"Even as shoppers are becoming savvier with technology today, the majority don't necessarily know what to expect when they arrive at checkout because it's not the same experience everywhere they go," Mark Bunney, Ingenico Group North America's director of go-to-market strategy, said in a statement. "Retailers are battling a series of information gaps with their consumers, as they try to offer them the latest capabilities for contactless cards and mobile wallets while also correcting the perceptions they're developing about security and ease-of-use for these technologies."