By Yannis Larios, VP of Strategy & Development at Viva Wallet
The effects of the Covid-19 pandemic have been felt globally. According to the latest projections from the ECB, the European Union’s (EU) economy is expected to fall by 8.0 percent in 2020, following the outbreak of Coronavirus (COVID-19) earlier in the year, with an economic recovery more widely anticipated in 2021. European businesses clearly still have a long way to go before it’s back to business as usual.
For many businesses, the COVID-19 outbreak has essentially worked as a ‘digital readiness check-up’. Whole industries with little or no digital footprint had to make leaps to join the digital economy overnight. During this era of social distancing, we have seen a huge shift in spending methods with digital payments emerging as the life jacket for all companies.
The pandemic has accelerated the decline of cash and sparked a surge in contactless transactions. Payments’ technologies and infrastructure became the arteries of the economy, and helped the economy breathe amidst the pandemic. This was clear when Mastercard reported that 75% of all transactions in Europe are now contactless after 29 European countries lifted the limit for contactless payments and the World Health Organisation advocated the use of contactless payments as an effective way to limit the spread of COVID-19.
Neobanks have demonstrated their agility
To date, the payments industry has remained largely a fragmented industry reliant on legacy technology. Now, this is changing fast. Ddigital payments are essential.Both small businesses and global brands have been forced to either accelerate their purchasing process or implement plans quicker to make payments safer and faster. Friction-free and contact-free processes that don’t hinder shoppers at the checkout are tools being used to welcome customers back in store and boost spending confidence once again.
As a result, the demand for digital tools and faster onboarding to new digital payment services is bigger than ever. That’s why Viva Wallet is also introducing card acceptance through tap-on-smartphones to merchants of all sizes, so that payments can be made anywhere in store, avoiding congestion at the cashier desk.
A seamless experience
At a time when everyday consumers have become well-accustomed to using digital processes and technologies in their everyday lives, businesses need to consider what this means for their existing payments processes. Lockdowns and social distancing are continuing to be implemented across the globe, driving further disengagement with legacy card terminals and a move towards digital payment methods. In a digital age, card details can be stored on wearable devices so payments can be made at the flick of a wrist while smartphones are being used to store digital wallets and can be quickly tapped to complete purchases.
Seamless and omnipresent payment options will quickly become the new norm, so organisations need to be prepared with a digital-first approach. Large payment providers have struggled to keep up with the pace of change due to their limited flexibility to launch new payment services or innovations in such short timeframes.
On the contrary, highly digital payment providers like Viva Wallet have been able to act swiftly, introducing innovations in card acquiring, new payment methods and digital tools to facilitate payments and address the rise in demand. This agility is fuelling the continued rise of digital-first banks.