Company News • 21.12.2011

Study examines consumer acceptance of new payment methods

German consumers are much more open to innovative payment methods than is generally assumed. The German love of cash is simply a myth according to a study by Dr Tomas Falk, holder of the ConCardis Endowed Chair for Consumer Behaviour at the European Business School.

The long dominance of cash seems to be crumbling. “Cash only” is a thing of the past as modern cashless payment methods surge into the market and offer consumers new alternatives. Contactless payment is already normal practice for some merchants. At least since “Google Wallet” was announced, everyone has been talking about mobile payment services. Both payment innovations have the potential to break the dominance of cash. This is the result of a current study "The myth that Germans love cash – an empirical study on the acceptance of innovative payment technologies".

User friendliness the utmost priority
German consumers generally have a positive view of modern payment methods. “Those questioned found both contactless and mobile payment practical and attractive. Around 68 percent of the study participants were in favour of contactless payment, and around 64 for mobile payment,” said Falk. To use contactless payment, customers “tap & go” by holding their card up to a card reading device. Mobile payment means completing a transaction with the help of a smartphone. To ensure that consumers actually use the new payment methods, providers must, most importantly, provide a high degree of user friendliness. First and foremost, the payment process should be easy to understand and control. Costs and risks, generally thought to be people's main reservations against alternative payment methods, were of surprisingly little concern to consumers. Furthermore, neither aspect would significantly discourage consumers from using these technologies in future. Overall, it is clear that German consumers are generally willing to try out innovative payment methods. The precondition for actually using the new payment procedures, however, is the provision of a comprehensive infrastructure of payment terminals and acceptance points.

Innovators are ambassadors
Innovators represent a consumer segment with a particularly high intention of using the latest payment methods. For contactless payment, this group comprises 35 percent of those surveyed. They use their debit cards extensively and are very future-oriented. For mobile payment, the innovator group comprises 23 percent of survey participants. They tend to be younger and to make above-average use of mobile services. Both groups tend to have a strong affinity to new media. In practical terms these results provide key information in terms of how to successfully introduce the two payment methods onto the market. “Innovators function as ambassadors for new payment methods. They prepare the ground for modern payment, not only by being the first to jump aboard, but also by enlightening their peers and convincing them to follow,” explained Falk.

Larger transactions possible with contactless payment
Overall, contactless payment has considerably more potential than previously thought in terms of transaction size. Those surveyed said they would use contactless payment for all transactions up to EUR 50 – not, as previously thought, only for low-value transactions of less than EUR 20. “It is notable that consumers are willing to use contactless cards for larger payments too. This payment method thus has far higher revenue potential for merchants than previously assumed,” said Manfred Krüger, CEO of ConCardis.

Contactless payment paving the way for mobile payment?
The focus of media interest is currently on mobile payment. However, the study shows that consumers are currently more willing to try contactless payment. Consumers are used to paying by card, so the advantages of card-based contactless payment, such as speed and convenience, are immediately obvious. Moreover, contactless payment can already be used in “islands of innovation” such as some petrol stations. It is likely that there will be a seamless transition, with contactless payment acting as a bridge and preparing the ground for mobile payment. Another reason for this could be that mobile payment appears more interesting than contactless payment. This reflects the wider range of possible uses for smartphones as intelligent wallets. As well as simply being used to make payments, for example, smartphones can also serve as a customer loyalty card or as a way to redeem coupons.

About the study/empirical methods
The study series used a two-stage approach; based on the 4-party model, consumers (cardholders), merchants (card acceptors), banks (card issuers) and acquirers took part in 30-minute telephone interviews on the subject of cashless payment. A quantitative online survey was designed to expand on the results of this qualitative survey and took place in March 2011. A total of 1,753 consumers participated in the online survey. Of these, 1004 answered questions on contactless payment and 749 on mobile payment. The average time taken to answer the survey was eleven minutes for the questions on contactless payment and twelve minutes for the questions on mobile payment. Statistical tests were used to ensure that the sample was representative. Evaluation of the results was completed in late August.

Supplier
Logo: ConCardis GmbH

ConCardis GmbH

Helfmann-Park 7
65760 Eschborn
Germany

related articles:

popular articles:

Thumbnail-Photo: Transform Customer Interactions with apg® Customizable Kiosk Floor Stand...
06.08.2024   #customer experience #kiosk applications

Transform Customer Interactions with apg® Customizable Kiosk Floor Stand

The leading provider of point-of-sale cash management and retail solutions, proudly announces the launch of its new Kiosk Floor Stand.

This innovative stand is designed to revolutionize customer service in various business environments through its high adaptability and user-focused design.The apg® Kiosk Floor Stand is unique in its ability to meet the diverse needs of different ...

Thumbnail-Photo: ITL showcase age & identity technology at  Seamless Europe...
09.09.2024   #brick and mortar retail #access control

ITL showcase age & identity technology at Seamless Europe

Innovative Technology offer a range of products that are ideal for retailers who are looking to implement age estimation technology ...

Thumbnail-Photo: Introducing the Design XS Keypad Wall Reader Series...
23.07.2024   #access control #authentication

Introducing the Design XS Keypad Wall Reader Series

A New Level of Security and Convenience for Access Control

Leading global access solutions provider Salto Systems, part of SALTO WECOSYSTEM, is thrilled ...

Thumbnail-Photo: Intelligent shopping assistant: how can it help in the store?...
26.06.2024   #brick and mortar retail #app

Intelligent shopping assistant: how can it help in the store?

Practical examples of use in DIY stores and fashion stores

Product search, navigation, shopping basket management and checkout: intelligent shopping assistants can now be integrated into ...

Thumbnail-Photo: Time saving made easy
18.07.2024   #brick and mortar retail #software applications

Time saving made easy

Use of technology in retail: focus on increasing efficiency and customer satisfaction

Task management software is one of the retail solutions designed to help shops save time and ...

Thumbnail-Photo: How Smart Cash Management Can Enhance Customer Satisfaction and...
13.08.2024   #customer satisfaction #Tech in Retail

How Smart Cash Management Can Enhance Customer Satisfaction and Engagement

Exclusive report from apg Solutions EMEA Ltd. shows possible solutions

More and more retailers are integrating cash payment at self-checkout (SCO). The reason for this is that consumers want to have the choice of how they pay. In times of high inflation, people want to know exactly what they are spending.But ...

Thumbnail-Photo: Zebra: Using transparency to combat losses and shrinkage...
24.05.2024   #Tech in Retail #personnel management

Zebra: Using transparency to combat losses and shrinkage

Companies in the retail sector like Lowes Food, Belk’s and Vera Bradley are gearing themselves up for the future with cost optimisation strategies.

Loss prevention is playing an increasingly important role in reducing inventory discrepancies.Inventory is a major challenge for companies in the retail sector: 82% of retailers in Zebra's latest 16th Annual Global Shopper Study say that ...

Thumbnail-Photo: Introducing the Salto Glass XS Reader Series...
10.07.2024   #RFID (radio frequency identification) #access control systems

Introducing the Salto Glass XS Reader Series

Redefining Smart Access Control

Salto proudly unveils the Glass XS Reader Series, an innovative line of products ...

Thumbnail-Photo: Fashion retail: mobile discovery, more convenient shopping...
04.07.2024   #online trading #brick and mortar retail

Fashion retail: mobile discovery, more convenient shopping

How Breuninger is breaking boundaries with omnichannel

Breuninger, with twelve stores in Germany and another in Luxembourg, provides a traditional shopping experience ...

Thumbnail-Photo: Hanshow Awarded FY24 China Top ISV Partner by Microsoft for Innovative...
04.09.2024   #artificial intelligence #cloud computing

Hanshow Awarded FY24 China Top ISV Partner by Microsoft for Innovative Retail Solutions

Hanshow, a leading provider of retail digital store solutions, has been awarded the "FY24 China Top ISV Partner" by Microsoft. The award recognizes Hanshow's innovative technologies and deep cooperation with Microsoft in the field of ...

Supplier

Innovative Technology Ltd.
Innovative Technology Ltd.
Innovative Business Park
OL1 4EQ Oldham
Zebra Technologies Germany GmbH
Zebra Technologies Germany GmbH
Ernst-Dietrich-Platz 2
40882 Ratingen
SALTO Systems GmbH
SALTO Systems GmbH
Schwelmer Str. 245
42389 Wuppertal
apg Solutions EMEA Ltd.
apg Solutions EMEA Ltd.
4 The Drove
BN9 0LA Newhaven