QH ON THE RISE OF CONTACTLESS PAYMENTS AND WHY IT MAKES BUSINESS SENSE
Going forward, the Qatar payments market is likely to see a Compound Annual Growth Rate (CAGR) of 14.21% between now and 2027. Interest in digital payments has seen robust growth in the region, where a number of faster payment initiatives have taken hold
Today’s consumers are becoming increasingly reliant on technology to make payments, and businesses need to adapt to the changing market. Investing in cashless payment systems is a smart move for any business looking to keep up with the latest trends and provide customers with a convenient and secure payment option.
The number of contactless card purchases made worldwide will increase by an average of 23% a year and reach a total of more than 522bn by 2026, up by more than 370bn on the 149bn recorded in 2020, according to a forecast by Retail Banking Research.
Lloyds Bank data shows that consumers in the United Kingdom use contactless payments in nearly 90% of face-to-face payment transactions — a massive increase prior to the onset of the Covid-19 pandemic. According to the bank’s findings 65% of face-to-face payments were made using contactless debit cards in June 2019, in the early stages of the pandemic – but by June 2022, this had reached 87%. The bank said that in June 2020 the proportion of face-to-face payments made by contactless debit cards was 72%, and in June 2021 it was 83%.
In the context of Qatar, contactless payments were a growing trend even before the pandemic. However, since the pandemic, almost all sectors — from healthcare to finance to education and retail — were compelled to shift to a digital-first realm as a safety measure. The Covid crisis spurred digital commerce way ahead of time, leading contactless and other digital payment options to emerge as speedy and efficient alternatives to cash safety measures aside.
Even the recently held FIFA World Cup offered a slick example of how this system does wonders in terms of safety, security, convenience and reach.
The country hosted more than 1.4 million visitors during this time and their arrival was preceded by a massive logistical challenge for the banking sector: how to seamlessly and safely process payments despite the huge increase in payment traffic volumes.
To meet this challenge, a number of banks worked under the supervision of the Central Bank to provide a digital banking platform ensuring all vendors had cashless payment capabilities and visitors conveniently used their international cards for payments.
The logistical challenges of this plan were huge. But it was met with speed and efficiency and a good example was outfitting thousands of taxis with virtual POS machines so people didn’t have to pay cash.
Going forward, the Qatar payments market is likely to see a Compound Annual Growth Rate (CAGR) of 14.21% between now and 2027. Interest in digital payments has seen robust growth in the region, where a number of faster payment initiatives have taken hold.
The move towards a cashless economy has seen the Qatar Central Bank (QCB) employing electronic wallets to harness the cashless payments. To this effect, QCB has also issued a unified QR code specification and standard. For instance, users can pay by scanning the QR code with their mobile phones at retail stores or on public transport.
E-commerce in the country is bound to gain ascendancy as more consumers get their goods and services provided digitally, seamlessly, and speedily. As a result, companies all around us want a pie of the e-commerce payment spend. This will certainly augment the payments market in the future, particularly in the services sector.
Ooredoo, Qatar’s leading telecom, introduced a digital MasterCard via Ooredoo Money app that could be had in just a few taps. The Digital MasterCard is available as a virtual card in Ooredoo Money app and can load the card as per need. It can be used for safe, convenient and secure online payments anywhere in the world where MasterCard is accepted online.
Last year, Vodafone Qatar’s Infinity Payment Solutions (IPS) also launched iPay, Qatar’s first licensed e-wallet. Licensed by Qatar Central Bank, iPay is a secure e-wallet developed by IPS in partnership with Commercial Bank of Qatar, Gulf Exchange and Paytm. iPay offers customers direct access to instant local transfers to all banks and wallets under the Qatar mobile payment network as well as international remittance and merchant payments.
Why businesses should invest in cashless payment systems
Increased efficiency: Cashless payment systems help businesses streamline the payment process, which reduces the time it takes to complete a transaction. This can lead to faster customer checkouts and a more efficient operation overall.
Reduced risk of loss: Cashless payment systems eliminate the need to handle large amounts of cash, which can reduce the risk of theft or loss.
Improved security: Cashless payment systems are more secure than cash, as they provide an extra layer of protection from fraud and other security threats.
Lower transaction fees: Credit cards and other cashless payment systems typically have lower transaction fees than cash, which can help businesses save money in the long run.
Access to more customers: Cashless payment systems can help businesses reach a wider audience. Customers who prefer to pay via credit card or other cashless payment methods will be more likely to patronise a business that offers this option.
Greater convenience: Cashless payment systems are more convenient than cash, as they allow customers to pay quickly and easily. This can help businesses attract more customers and increase their sales.
Improved customer service: Cashless payment systems can help businesses provide better customer service. By eliminating the need to wait in line to pay with cash, customers will be able to complete their orders quickly and easily.
The benefits of investing in cashless payment systems are clear. Not only do they help businesses save time and money, but they also provide customers with a convenient and secure payment option. For businesses looking to stay competitive and meet the needs of their customers, investing in cashless payment systems is a smart move.
