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Will the future be cards, mobile payments… or both?


A new white paper from Tietoevry Banking argues that - rather than competing - card payments and mobile payments can complement one another in the payments ecosystem. Tietoevry head of card sales and business development Hans Sjölund explains why.

The digital revolution has enabled a new generation of payment methods, from digital wallets through to wearables, crypto currencies, and account-to-account transactions. Some estimates suggest that half of the world’s population will be using digital wallets stored on mobile devices by 2050.

However, such statistics only tell part of the story. New research from Payments Cards & Mobile shows that payment card use actually grew far above the trend across Europe coming out of the pandemic. The number of cards in circulation last year grew by 20% above the long-term average across Europe, at 5.18%, while spending on cards shot up by 16.35%, more than three times the long-term average.

Despite the much-hyped consumer preference for digital wallets in e-commerce, cards remain the preferred option for online shopping in key European markets like the UK (where they account for 51% of transactions) and France (53.9%), and are neck-and-neck across the whole of Europe, with cards used in 42% of all online transactions compared with 44% for wallets.

Consumer familiarity, trust, and convenience are key factors behind the ongoing popularity of cards. For instance, a study conducted by Visa USA and The Strawhecker Group during the pandemic revealed that 65% of US consumers preferred using contactless payment cards in any payment scenario, due to their familiarity and convenience.

The last five years have seen new features like near-field communication (NFC) contactless transactions, biometric security, and multi-function cards that feature debit and/or credit, loyalty, and buy-now-pay-later (BNPL) combine to make cards more relevant in the digital age. Over the same period, mobile device penetration has exceeded 100% in most developed economies.

Rather than seeing mobile wallets displace cards, the white paper highlights a growing symbiotic relationship between cards and phones, whether that’s card management apps or the use of digital wallets linked to payment cards, as is the case with 61% of wallets.