Contactless payments market has been growing quickly. As digital infrastructure continues to advance, the ease and speed of contactless transactions are becoming increasingly attractive to consumers and businesses.
Instead of entering a PIN or handling cash, users can simply tap their card or mobile device to complete a transaction in seconds. This frictionless experience not only enhances customer satisfaction but also reduces checkout times for businesses, making it an appealing option for retailers.
Beyond convenience, the expansion of mobile wallets like Apple Pay, Google Pay, and Samsung Pay has also played a significant role in boosting contactless payment adoption. These digital wallets offer enhanced security features, such as biometric authentication, and can be used for a variety of transactions, from in-store purchases to public transportation.
What are Contactless Payments?
Types of Contactless Payments and Statistics
Contactless payments can be broadly categorized into three main types: contactless cards, mobile wallets, and wearable devices. Here’s a breakdown of each type and its growing significance:
1. Contactless Cards
- Percentage of Transactions: Contactless cards account for the majority of contactless payments globally. In regions like Europe and Australia, contactless card payments represent over 60-70% of total card-based transactions. As of 2023 in the USA, credit and debit cards dominate the contactless payment landscape, accounting for around 62% of all contactless transactions (mobile wallets make up about 29% and wearables are 9%).
- Growth Factors: The widespread issuance of NFC-enabled debit and credit cards has made tap-to-pay ubiquitous. Many businesses and consumers adopted contactless cards during the COVID-19 pandemic as a safer alternative to cash and PIN entry. The convenience and speed of transactions under a certain limit (e.g., £100 in the UK) further drive usage.
2. Mobile Wallets
- Percentage of Transactions: Mobile wallets like Apple Pay, Google Pay, and Samsung Pay are gaining ground, accounting for about 15-30% of all contactless transactions in many developed markets. In some Asian countries, such as China, mobile payments dominate, although QR codes are often more popular than NFC.
- Growth Factors: Mobile wallets provide additional layers of security through biometric authentication (fingerprint, facial recognition), making them attractive for higher-value transactions. Their integration into smartphones and wearables ensures seamless payments for consumers who prefer carrying a device over a physical card.
3. Wearable Devices
- Percentage of Transactions: Though still a small portion, wearable devices like smartwatches, fitness trackers, and even rings are becoming more common for contactless payments. Wearables currently represent around 5-10% of contactless transactions, with higher adoption in tech-forward markets.
- Growth Factors: Wearables are favored for their convenience in scenarios where carrying a card or phone is less practical, such as during exercise. The expansion of wearables into payments is supported by companies like Apple, Garmin, and Fitbit, integrating NFC technology into their products.
The Number of Contactless Payments by Country
Graph of the number of contactless payments by country. See table below for data.
In Canada and the U.S., the jump is even more striking, with the U.S. growing from 2.9 billion in 2018 to 16 billion in 2023, as American consumers embraced the convenience of “tap and go” payments, especially during the pandemic when contactless options became essential for safety. Germany, traditionally reliant on cash, saw slower but notable growth, from 0.5 billion transactions in 2018 to 6 billion in 2023, as cultural attitudes shifted.
Interestingly, China, while seeing contactless growth, continues to favour mobile QR code payments, explaining its relatively slower increase compared to other countries. The overall trend is toward greater convenience, speed, and security in payments, with mobile devices increasingly driving this evolution.
Number of Contactless Payment Transactions by Country (billions)
| Country | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 |
|---|---|---|---|---|---|---|
| United Kingdom | 6.6 | 8.6 | 10.0 | 13.0 | 15.0 | 18.3 |
| Australia | 2.5 | 3.2 | 4.0 | 4.5 | 5.0 | 5.5 |
| Canada | 1.5 | 2.2 | 3.0 | 4.0 | 5.0 | 5.5 |
| United States | 2.9 | 4.7 | 8.1 | 11.1 | 14.4 | 16.0 |
| France | 1.7 | 2.8 | 4.0 | 5.5 | 7.0 | 8.0 |
| Germany | 0.5 | 1.2 | 2.5 | 4.0 | 5.5 | 6.0 |
| China | 4.0 | 5.0 | 6.5 | 8.0 | 9.5 | 10.5 |
| Japan | 1.0 | 1.5 | 2.0 | 3.0 | 4.0 | 5.0 |
The Percentage of Contactless Transactions
The percentage of total transactions that are contactless varies significantly by country, influenced by factors such as technology infrastructure, consumer preferences, and the regulatory environment. Here’s a breakdown by country with explanations of the trends:
1. United Kingdom
In the UK, contactless transactions made up 38% of all payments by 2023. The UK has been an early adopter of contactless technology, driven by a strong card payment culture and widespread availability of contactless terminals. The growth was accelerated by the COVID-19 pandemic, as consumers preferred touch-free transactions. The UK also saw an increase in the use of mobile wallets like Apple Pay, which contributed to the rise in contactless transactions.
2. Australia
Australia has one of the highest contactless adoption rates globally. By 2023, a significant majority of payments were contactless, with nearly all card-present transactions being contactless. The country’s advanced financial infrastructure and strong consumer preference for convenience have been key drivers. Contactless payments were already common before the pandemic, and COVID-19 further solidified the shift away from cash and PIN-based card transactions.
3. Canada
In Canada, contactless payments made up about 50% of card transactions by 2023. Canada’s consumers are drawn to the convenience and speed of tap payments, and the availability of contactless terminals across retailers has supported this trend. The pandemic played a significant role in pushing adoption higher as businesses encouraged touch-free payments to reduce contact.
4. United States
The U.S. has seen a slower adoption curve compared to other developed markets, but it picked up rapidly in recent years. In 2023, contactless accounted for approximately 36% of all card payments. This growth is largely driven by increased card issuance with contactless features and heightened consumer demand for safer, more convenient payment options post-pandemic. However, the U.S. market still has some room to grow due to its continued reliance on magnetic stripe and chip-and-signature cards.
5. France
France has seen strong growth in contactless payments, accounting for nearly 50% of all card payments by 2023. French consumers and businesses embraced contactless technology early, particularly during the pandemic. The French government’s decision to raise the contactless payment limit also contributed to the increased adoption, making it more suitable for everyday purchases.
6. Germany
Traditionally a cash-heavy society, Germany has shown slower growth in contactless payments, but by 2023, contactless payments accounted for about 35% of all transactions. The pandemic forced a cultural shift, encouraging more Germans to move away from cash. Retailers have also embraced the technology more recently, improving the availability of contactless options.
7. China
Contactless transactions in China account for a smaller percentage of total transactions compared to other countries, primarily because mobile QR code payments dominate the market. Contactless card payments only account for a minor share of total payments, as platforms like Alipay and WeChat Pay remain the preferred methods. Even so, the growth of contactless payments is steady, driven by the convenience of tapping for smaller purchases.
8. Japan
In Japan, contactless payments still lag behind global averages, but they are growing. As of 2023, around 20-30% of card transactions were contactless Japan’s payment culture has historically favored cash, but the government’s push for a cashless society, alongside technological advancements and public health concerns from COVID-19, has increased the uptake of contactless payments.
Trends of Contactless Payments Across Countries
The COVID-19 pandemic served as a powerful catalyst for the global adoption of contactless payments. Across many countries, consumers rapidly shifted to safer, touch-free transaction methods, driven by health concerns and the need for minimal physical contact. In response, numerous governments and financial institutions increased contactless payment limits, allowing for higher-value purchases without the need for PIN entry. This move significantly broadened the appeal of contactless payments, making them more practical for everyday use.
The expansion of mobile wallet platforms, such as Apple Pay and Google Pay, further fueled this growth. These digital wallets, integrated into smartphones and wearables, leveraged the same infrastructure as contactless cards, offering consumers a seamless, secure, and fast way to pay. As mobile wallet adoption rose, so did the overall volume of contactless transactions.
In countries like Germany and Japan, where cash has long been dominant, the cultural shift toward digital payments has been slower but is now gaining momentum. Younger generations, in particular, are driving this change, alongside the increasing availability of contactless-enabled point-of-sale (POS) terminals. While these markets may have been slower to adopt, the trend is unmistakable: as technology advances and consumer preferences evolve, contactless payments are becoming the norm.
These trends strongly suggest that contactless payments will continue to grow, with more consumers embracing the speed, convenience, and security of tap-based transactions.
How Merchants can Accept Contactless Payments
Merchants looking to accept contactless payments through Clearly Payments can easily get started by setting up one of their NFC-enabled payment terminals. Clearly Payments offers a variety of terminal options, including both countertop and mobile devices, which support contactless methods like tap-to-pay, Apple Pay, and Google Pay.
Merchants can integrate these terminals into their existing point-of-sale systems, enabling fast and secure transactions. Additionally, Clearly Payments provides easy onboarding with transparent pricing, no long-term contracts, and 24/7 customer support to ensure a smooth setup process.
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