The Future of Contactless Payments

The COVID-19 pandemic has ignited public concerns regarding the viral transmission of the virus through cash. According to the Bank for International Settlements, central banks have reported a large increase in media queries pertaining to the safety of cash payments. However, scientific evidence suggests that the likelihood of the virus transmitting through banknotes is low, especially when compared to other payment systems such as credit card terminals and PIN pads.

 

In order to promote a universal acceptance and trust in cash, many banks have reiterated the low risks associated with cash payments. Some countries have enforced the sterilization of banknotes and some central banks and governments have encouraged cashless payments.

 

Many new developments suggest digital payments are the future, yet not all of these are considered immune. The implications associated with debit and credit transactions usually involve a signature or a PIN. For smaller payments, contactless payments do offer a solution if under a specific limit. The importance of such advancements could lead to a divide in payments between those with access to digital payments and those without.

As a result, the shift towards accessible and resilient central bank digital currencies could be accelerated. This technological solution would be designed to allow access for the unbanked as well as provide a contact-free technical interface suitable for the entire population. 

The pandemic has put such options into sharper focus, highlighting the value of having access to a diverse means of payments, and the need for any means of payment to be resilient against a broad range of threats.