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Cultural differences

Despite the substantial uptake of electronic payments, the cultural

differences between countries regarding the place of cash in society

mean acceptance varies between different territories.

As Cairns outlined, tackling financial inclusion is a further barrier: “Our

core infrastructure works the same way across the world, but how we

position ourselves in different markets takes into account what

consumers want to do in those markets, as well as what other partners

in those markets are doing. Some governments are very forward-looking

in terms of driving cash out of their economies, whilst others take more

of a backseat approach. We are trying to work with the public and private

sectors to examine the benefits of going electronic, discussing

transparency and safety.

“Financial inclusion is not just a problem in emerging markets but also

across Europe. There are over 100 million Europeans who are financially

excluded. This can be worse than being financially excluded in Africa,

where at least there may be an informal barter system in place. If you

want to buy something online but do not have any access to electronic

products, this is not a good position to be in in Europe today.

“Such environments mean consumers often end up paying more money

for exactly the same item. This is sort of a double jeopardy in that the

poor are being charged more because they do not have access to new

mechanisms. A way of addressing this is through prepaid cards, which

at least give people the ability to go online.”


Despite the trend towards mobile payments, Cairns said that plastic

cards, and even cash, will not suddenly disappear from the pockets

of consumers.

“85% of the world’s consumer payments are cash, and in several

countries, that figure rises above 90%; for example it is around 91-92%

in Russia. Cash is going to co-exist for quite a long time, but countries

will reach a tipping point,” she said.

information without doing anything that would

be detrimental to the individual; the only data

that we have is Big Data.”

On the move

Cairns commented that there is a real

enthusiasm from consumers about using

contactless payments, particularly in

Scandinavia: “There is a general push from

consumers, though that varies across Europe.

In Scandinavia, they went towards electronic

payments very quickly, whilst a couple of weeks

ago the UK passed the tipping point between

electronic and cash, though it differs throughout

the country. Denmark is saying that it is going

to work with retailers to go almost totally

electronic, but if you consider Germany, they

are still very high cash users.”

The transport system is one way of

encouraging consumers to use electronic

payments more often in everyday life: “For a

while now, all London buses have been

completely contactless, allowing users to tap

their card to pay for their journey when they get

on a bus. A few months ago, the whole of the

London Underground went contactless, and the

take-up was tremendous, growing at a double-

digit rate every day; there are now an estimated

one million taps a day in London.

“Once we embark on something that affects

everybody’s lives on a day-to-day basis, it

becomes familiar and people start tapping to

get their coffee from Starbucks, etc. We are

also working with different merchants and

airlines to create co-branded opportunities and

to give people access to electronic payments

that way.

“Across our network, seven out of ten

transactions are now contactless, and Australia

has actually raised the limit to $100 (~€70). In

the UK it is currently at £20 (~€28), but it’s

going to £30. That means you can buy a decent

basket of groceries using a contactless

payment method in Australia, and it is these

kinds of changes that drive adoption. They

seem quite simple things, but it’s really just

ease of use.”

H O R I Z O N 2 0 2 0 P R O J E C T S : P O R TA L




Londoners are now

able to use mobile

payments instead of

traditional Oyster

cards when travelling

on London