Coronavirus-driven loosening of contactless payment limits boosts volume for Barclays
Barclays has experienced an incremental £264 million (about $330 million) in contactless spend in the month since it raised its per-transaction limit in response to the coronavirus pandemic, which has created an aversion to cash and contact payments.
The main cause for this higher volume is in direct response to Barclaycard raising its contactless limit from £30 (about $37) to £45 (about $55) on March 24 in response to consumer fears about touching in-store payment terminals during the COVID-19 pandemic. Since the shift Barclaycard has reported that in the past month seven million additional transactions have been processed between the old and new limit amounts.
“We want to play our part in helping to prevent the spread of COVID-19, so we are delighted to have reached 7 million transactions so quickly," said Rob Cameron, CEO of Barclaycard Payments in a press release.
"We believe that contactless is the safest, fastest and most responsible way to pay in store, and we encourage all consumers to take advantage of the new higher limit where possible,” Cameron added.
Additionally, 43% of in-store transactions between the old and new limits are now made using contactless technology. The initial rollout of the new contactless limits has been prioritized to certain retail segments such as grocery stores, bakeries, pharmacies and gas stations. As the higher contactless limit gets rolled out to a wider set of retailers, it could be expected that the percentage of contactless transactions will rise.
Barclaycard has promoted contactless payments as a means of both consumer safety and convenience while shopping. Barclaycard claims that contactless transactions are seven seconds faster than contact chip-and-PIN and 15 seconds faster than cash. Further, the ability to pay without touching card terminals or handling cash will help prevent the spread of the virus.
The new, higher limit has led the average value of contactless transactions to rise from £9.28 to just under £14. The average ticket size for transactions between the old and new limit is £36.
Many banks and networks have aggressively pushed higher contactless limits in the past month as a means to provide consumers with a safer means of payment as they make larger purchases. In March Mastercard doubled the contactless limit across 29 European countries with most Eurozone nations going to €50 (about $56). This followed an earlier move by Dutch banks to raise their contactless limits to €100 (about $110). In April Mastercard raised the contactless limit in Canada to CA$250 (about $178).