Tipping (Price) Point for Contactless Payments
By Rónán Gallagher, Head of Product, Alpha Payments Cloud.
In Ireland contactless payments have been reasonably widely publicised, especially by VISA. However, I wonder if the price point is set high enough to encourage mass adoption. €15 is the maximum contactless payment in Ireland that doesn’t require a PIN. In the UK, at least based on signage I saw in a shop last week, it is £20 (approx. €25). In Australia, where PIN is being mandated from later this year, contactless payments can be made upto 100 AUD (approx. €70) without requiring a signature or PIN.
Australia, according to MasterCard, is the largest Paypass market in the world, 43% of Australians are paying using contactless and 60% of scheme debit transactions are made using contactless.
Of course, issuers determine the level of risk they are willing to accept but I wonder if the maximum contactless payment were to be increased in Ireland would more consumers opt to ‘Tap and Go’. Perhaps a good example is Aldi, the supermarket chain. They have had quiet visible signage in stores about accepting contactless payments. However, not once has my basket cost less than €15 and I wonder how many transactions they process under that amount. Lidl also offer contactless payments and even have a link on their website publicising the fact.
Although it is a bit of a moot point for me at the minute as I switched banks earlier this year and my new bank does not support contactless on my debit card, at least not yet.