Did contactless transactions exceed cash payments? The use of contactless payments has been increasing since the beginning of the COVID pandemic because of the convenience and security they provide. Their number is expected to increase by more than 80% worldwide by 2025, and 3 times by the end of 2030.
What are the most common payment methods in 2021 according to the report of The Paypers? Learn about the 6 most used ways for paying online or in stores, transferring funds, paying debts, etc. that people around the world have chosen to use.
1. Digital wallets
Transactions made through digital wallets were the most popular way to pay in the past year. Digital wallets allow you to store and manage your finances entirely through your phone. In them, you can find debit cards, digitize discount cards, pay via QR code, phone, smartwatch or NFC accessory.
Super apps are mobile applications that provide many services at once, including payments. Their number is constantly increasing. These apps are gaining popularity because they eliminate the need among users to download a different app for each feature. An example of a digital wallet that is about to become a super app is iCard, as it offers a wide variety of services and works with a big network of partners.
2. Card payments
The second most common way to make money transactions for the past year was paying with a card – debit, credit or prepaid. What is the difference between all of them? Credit cards allow their cardholders to use funds, which must be refunded back. They are most often used for purchases made both online and in stores.
In contrast, debit cards are linked to an account from which the funds that are used for purchases are already owned by the cardholders. Debit cards can be both physical and virtual. The third type is prepaid cards. With them, each card is pre-loaded with a certain amount, which serves as a limit on transactions.
3. Account-to-Account Payments
Transferring funds directly from one account to another without using additional payment instruments (A2A payments) is also included in the ranking of the most used payment methods in 2021. This method of exchanging money is gaining popularity among consumers after real-time payments become possible.
Consumers can benefit from this type of transaction for both business and personal purposes. Sending money from one account to another is also a favourite feature of iCard digital wallet users. Through it, all internal money transfers are instant and free of charge.
4. Direct debit
Direct debit is the regular payment, with which the payment institution automatically pays your debts. In these cases, consumers give their permission to the payment institution to pay automatically the bill at their request. Transfers of this type account for 4% of all payments in Europe and reach 1.2% worldwide.
Don’t forget that all iCard customers can take advantage of direct debit in all SEPA countries for euro payments. Your debts will be automatically paid for the fee of 1.00 EUR.
5. Buy now, pay later
With the “Buy now, pay later” payment method, each client can buy a certain product in a few instalments instead of paying the full amount at once. It’s gained more and more popularity around the world in the last two years. In most cases, no interest is paid when using the service, which makes it even more popular with millions of people.
6. In cash
Not all payments in the world are made online. An interesting fact is that 31% of people worldwide still don’t have a bank account and do not have access to payment instruments such as credit or debit cards. This makes cash payments still widespread in our society. 3.3% of all online orders made worldwide in 2020 were purchased by cash on delivery.
All iCard customers can withdraw cash from ATMs using their physical debit cards. If the device is contactless, they can use iCard Pay (for phones with Android) or their virtual cards added to Apple Pay, Google Pay or Garmin Pay to withdraw the amount via their phone or watch. Users can withdraw money from ATM devices around the whole world as each transaction has a fixed fee.
iCard digital wallet allows you to make payments in different ways, all gathered in one place. With the opening of your iCard account, you will receive 3 debit cards without fees – one physical (which you can order from the app) and two virtual (which are activated automatically). Take advantage of transferring funds to another iCard account free of charge, as well as advantageous transfers to other banks. Manage your finances in the most convenient way for you.