Card payments have evolved significantly, with mobile and contactless options gaining popularity, though traditional chip cards still dominate. In 2023, 61% of in-store payments were made with physical cards, while mobile payments lagged at just 5%. Contactless methods, boosted during the Covid crisis, are now widely adopted, particularly for tolls. Security innovations like tokenization are enhancing online transactions, yet challenges remain in cash withdrawals and consumer confidence, keeping traditional methods relevant in France.
The Evolution of Card Payments in Recent Years
The landscape of card payments has experienced significant transformations over the past few years, with innovations such as mobile payment, contactless transactions, and the generation of random card numbers. Despite these advancements, the traditional chip card remains a steadfast choice among consumers.
Current Payment Trends and Future Predictions
According to the Payment Means Security Observatory, in 2023, out of every 100 card payments made in physical stores, 61 were executed using physical cards, 34 through contactless cards, and just 5 via mobile phones. This reflects a notable shift in payment preferences over time.
Back in 2016, mobile payment usage was virtually nonexistent, but it surged between 2018 and 2019, growing over 300%. However, this growth has begun to plateau, with a 90% increase observed between 2022 and 2023. Loÿs Moulin, director of development for the banking card group, anticipates this trend will continue to slow into 2024. He emphasizes that while mobile payments are set to grow significantly in the coming years, users are likely to maintain both mobile payment options and physical cards in their wallets.
Lack of awareness, the digital divide, and security concerns have hindered the anticipated growth of mobile payments since the introduction of Apple Pay in France in 2016.
Contactless Payments and Their Impact
Contactless payment methods gained traction in France during the Covid crisis, offering solutions to specific challenges. Yvan Vincent-Viry, the financial manager at Vinci Autoroutes, noted the efficiency of contactless payments, particularly at toll booths where delays can cause anxiety for drivers trapped behind barriers.
With the decline of magnetic strip technology, which is susceptible to fraud, Vinci sought a safer alternative. They successfully adapted contactless payment systems to accept transactions exceeding 50 euros, enhancing convenience for motorists.
Another groundbreaking development is the concept of “tokenization.” This security technique replaces traditional card numbers with a unique series of random characters during online transactions, minimizing the risk of exposure to merchants’ servers. Remy Belloir, commercial director for Thales in France, highlighted the increasing adoption of tokenized transactions in e-commerce, driven by major companies like Amazon and Google.
Despite the shift towards digital payments, challenges remain, particularly regarding ATM cash withdrawal capabilities and consumer confidence in international transactions, according to Jean-Paul Albert from Société Générale.
Meanwhile, Lionel Jouve from Carrefour noted that while digital payment methods are on the rise, traditional payment methods such as checks—despite being over 160 years old—still hold a place in the hearts of many French consumers. The chip card, therefore, remains a vital part of the payment ecosystem in France.