Ireland's Mobile Payment Boom: 53.1% Contactless via Smartphones

Industrials

8 days agoPWG Publications

Mobile Payments Revolution: Over Half of Irish Contactless Transactions Now Made with Smartphones and Watches

The way Irish consumers make contactless payments has seen a significant shift in recent years, with mobile wallets—using apps like Apple Pay and Google Pay on smartphones and watches—becoming the preferred method for more than half of all transactions. This trend marks a substantial change in how people pay in retail settings across Ireland, with contactless payments now dominating the scene.

Introduction to Contactless Payments in Ireland

Contactless payments in Ireland have experienced remarkable growth, with these transactions now accounting for 87.1% of all point-of-sale (POS) card payments in retail outlets, restaurants, and other businesses. According to the Banking & Payments Federation Ireland (BPFI), over 1.5 billion contactless payments were made in 2024, valued at €26.7 billion. This surge highlights the increasing reliance on digital payment technologies for everyday transactions.

Rise of Mobile Wallets

A key finding from the BPFI Payments Monitor reveals that more than half of these contactless payments are now made using mobile phones and watches rather than traditional cards. This shift underscores the convenience and ease of use of mobile wallet payments, which are facilitating a rapid transition towards cashless transactions in the Irish retail sector.

Influence of Age and Region

The preference for mobile wallets over traditional payment methods varies across age groups. Younger consumers, particularly those aged 18-24, are more likely to use their smartphones as their preferred payment method. This age group's embrace of technology is driving the trend towards mobile payments, capitalizing on the convenience and speed offered by contactless transactions.

Geographically, Dublin is at the forefront of contactless payments per capita, with a rate significantly higher than the national average. Other regions like Carlow, Limerick, and Waterford also show high rates of contactless payments, while areas like Roscommon and Offaly have lower usage rates.

Benefits and Trends

Advantages of Mobile Wallets

Convenience: Mobile wallets offer users a seamless payment experience, allowing them to make transactions without needing to carry physical cards.
Security: Transactions are encrypted and linked to the device, offering an additional layer of security compared to traditional card payments.
Digital Receipts: Users can easily track their spending through digital receipts available on their devices.

Growing Adoption Rates

The share of mobile wallet payments in contactless transactions has increased significantly. As of June 2024, mobile wallets accounted for 53.1% of contactless payments, up from 45.9% in June 2023. This growth is influenced by higher average spends per mobile wallet payment, often 25% more than traditional contactless card payments.

Consumer Confidence and Awareness

While Irish consumers have shown a strong embrace of new payment technologies, there are areas where awareness and confidence could be improved:

Open Banking: Less than half of consumers are familiar with open banking services, which allow third-party access to banking data for financial management tools. This highlights a need for increased awareness and education on these services.
Digital Euro: Only about a quarter of consumers are aware of plans for a digital euro, a form of digital cash proposed by the European Central Bank. The ECB is set to decide on the next phase of its rollout later this year, emphasizing the importance of raising consumer awareness about this potential innovation.

Regional Breakdown of Contactless Payments

Data from the Central Bank of Ireland provides insights into the regional distribution of contactless payments. Dublin leads the way in both the volume and frequency of transactions. However, regional differences exist in terms of average transaction values, with Dublin having one of the lowest average payment amounts at €16.52 and Westmeath having the highest at €18.36.

Future of Contactless Payments

As Ireland continues on the path towards a more cashless society, the integration of mobile wallets is expected to play a central role. The rapid adoption of these digital payment methods indicates a shift towards greater efficiency and convenience in consumer transactions.

Key Takeaways

Increasing Mobile Adoption: More than half of contactless payments in Ireland are now made using mobile phones or watches.
Contactless Dominance: Contactless payments account for 87.1% of all POS card transactions.
Regional Variations: Dublin leads in the frequency of contactless payments, but regional differences exist in average transaction values.
Need for Awareness: Consumers need more information about emerging technologies like open banking and the digital euro.

Conclusion

The use of mobile wallets in Ireland has reached a critical mass, signaling a significant change in how consumers interact with retailers. As technology continues to advance, it is likely that mobile and watch-based payments will become even more prevalent, further reducing the reliance on cash and traditional payment methods. The trend towards mobile payments reflects a broader global movement towards digitizing financial transactions, underscoring the importance of adapting to these changes to remain competitive in the retail landscape.

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