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Pandemic will accelerate the rise of digital payments


Digitalisation of the global economy has increased the use of cashless payments worldwide

The United States and China lead the global trend on cashless payments

Source: Bank for International Settlements (BIS); Global Payments Report, WorldPay from FIS, January 2020

Outlook

The COVID-19 pandemic will accelerate the switch to digital payments worldwide. Since cash is dirty, expensive to print and circulate, and more easily evades financial transparency norms, a growing number of businesses and consumers will switch to digital payments, even for in-person purchases.

As consumer preferences change, both service providers and retailers are adopting an omnichannel business model offering a seamless offline and online experience. These models depend on a secure and simple digital payments infrastructure. Cross-border services and goods trade, facilitated by online platforms, will also increase the use of cashless financial tools.

Impacts

  • As ever more businesses develop their digital presence, the cybersecurity needs of industry will multiply sharply.
  • The popularity of digital wallets of companies such as Google, Apple and Facebook will intensify calls for tighter regulation of 'big tech'.
  • Growing use of digital financial transfers should help reduce fraud, tax evasion and money laundering.
  • Robust regulatory frameworks hold the key to wider adoption of cryptocurrencies and stablecoins.
  • Mobile money will remain important in emerging markets, where formal banking and digital access is constrained
https://dailybrief.oxan.com/Analysis/GA256401/Pandemic-will-accelerate-the-rise-of-digital-payments

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