How contactless payments are driving digital payment services in times of COVID-19
                     How contactless payments are 
driving digital payment services 
in times of COVID-19
• EVEN BEFORE THE COVID-19 PANDEMIC INFLICTED A MASSIVE 
HEALTH AND ECONSOMIC CATASTROPHE, CONTACTLESS 
PAYMENTS WERE ALREADY A WIDELY USED PAYMENT METHOD. 
HOWEVER, ONCE THE BUSINESSES REOPENED, THEY HAD TO 
KEEP IN MIND THE GERM-CONSCIOUS CUSTOMERS AND ADAPT TO 
THE NEW NORMAL OF SOCIAL DISTANCING.

COVID-19: The catalyst in the 
contactless payment adoption
 There has been a steep rise in the adoption of contactless payments all around the world. 
The below stats are the testimony to this fact:
 In the US, 51% of people have resorted to use mobile wallets like Apple Pay and other tap-
to-go credit cards.
 Around 58% of the people in the United States are now more likely to use contactless 
payment methods than they were before the pandemic.
 MasterCard has witnessed a surge of 40% in the contactless payments in the first quarter 
of the year.
 60% of Visa users who live outside of the US have used ‘tap-to-pay’
 79% of the MasterCard users all around the globe have used contactless payments during 
COVID-19 pandemic.
 There has been a +40% of ‘year to year’ global contactless growth between Jan to March 
this year.
What’s the technology behind 
contactless payments?
• We saw the reason behind the rapid adoption of contactless 
payments. But what is it that makes contactless payments 
the first choice for business owners and customers in times 
of the pandemic? To understand this, let’s understand in 
detail about the technology behind contactless payments.
• Generally, there are two types of contactless payments in 
use. Let’s have a look at them one by one:
Contactless cards
• When a user uses a contactless card for making a transaction, then the card establishes 
communication with a point of sale (POS) terminal via NFC (near field communication) or 
RFID (radio frequency identification). After that, the card generates a unique code for each 
transaction which makes the process safer.
• Since there’s no requirement for a signature or a pin, contactless payments come with a 
limit per transaction which is also known as cardholder verification limit (cvm). The CVM is 
an effective way to protect users’ accounts.
• As contactless payments gain popularity, financial institutions all over the world are 
increasing their cvm limit to enable customers to successfully make transactions during 
lockdowns with utmost safety.
• Mastercard is already working with the regulators to increase the cvm to satisfy customer’s 
needs along with boosting the trend of contactless payments. Mastercard is planning to 
enable contactless payments up to $250 CAD in canada itself. Moreover, the CVM went 
from £30 to £45 in the UK which is equivalent to that of 29 other european nations.
E-wallets
• E-wallets, electronic wallets, or mobile wallet solutions enable users to 
make payments easily, safely, and conveniently. There are several mobile 
wallets available in the market such as Google Pay, Apple Pay, Venmo, 
Mastercard, and Masterpass.
• Tokenization makes mobile wallets one of the most secure mediums to 
make payments. During this process, all the sensitive data is replaced with 
a token or value. This value or token then protects the sensitive data like 
the card number and others which are prone to frauds and scams.
• It also means that the device never stores the actual account number on it. 
Tokenization in combination with radio-frequency identification offers a 
quick, easy, and safe way of making transactions to users.
 Contactless technologies: a part of 
a bigger transformation of digital 
financial services
Adopting a collaborative approach 
between traditional banks and fintech
Increased digital innovation with open 
banking
Enhanced personalization and customer 
experience
 Conclusion
• The COVID-19 pandemic has tremendously affected our social and 
economic well-being. However, it’s also true that it has been one 
of the biggest drivers of digitalization across the globe. Digital 
payments, especially contactless payments have emerged as a 
fool proof way for businesses and enterprises to operate in the 
new normal post COVID-19.
• In coming days, we might see acceleration in the adoption of 
contactless payments. This might also result in rapid innovations 
in the contactless technology that might encourage FinTech 
startups and enterprises to heavily disrupt the financial sector.
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