COVID-19 has intensified Australia’s love of contactless payments

Today, payments company Square released a report that shows the impact the COVID-19 pandemic has had on Australia’s intensifying relationship with contactless payments. There has been a cashless growth spurt among Australian businesses since the onset of the pandemic, with 1 in 4 businesses now operating as cashless*, compared to just 1 in 12 this time last year.

The report, entitled Payments, and the Pandemic, looks at the effects of mandated lockdowns, social-distancing limitations, and ongoing trading restrictions on consumer and business behaviour in relation to payments. The data was captured from millions of transactions at thousands of Square businesses across the country over the past 12 months.

“As the COVID-19 pandemic swept across Australia last year, we saw a sharp decline in cash use as businesses and consumers became more reluctant to physically handle money at a time when health, and mitigating the spread of germs, was their top priority,” said Samina Hussain-Letch, Head of Industry & Payments at Square Australia. “And while some regions and industries are starting to see cash pick up in circulation again, we are yet to see it return to pre-pandemic levels.”

Square’s data shows that regionally, Victoria saw the most significant rise in the number of cashless businesses operating throughout 2020. While just 5% of the state’s businesses were operating as cashless in February last year, this grew to a peak of 40% in April and then again in August 2020, coinciding with the state’s two lockdown periods. While the number of cashless businesses in the Northern Territory still doubled over the course of 2020, this region saw the least dramatic shift in businesses turning away from cash.

For consumers, the number of people opting to pay with cash plummeted by more than half throughout the year. In February 2020, 36% of all in-person transactions were made in cash, compared to just 15% by April during the pandemic’s first wave. As of February 2021, cash use had increased a little but only made up 18% of all in-person transactions.

Across the states, Tasmania and the ACT saw the most significant decline in cash use among consumers, while Western Australia and the Northern Territory saw the smallest shift. As of February 2021, Victoria and Western Australia had the lowest rates of cash use in the country (15%), while South Australia and the Northern Territory had the highest (22%).

Brittany Garbutt, owner and managing director of national chain Pretzel, says the change in consumer behaviour is evident across Australia.

“Over the past year, our east coast stores have been more impacted by COVID-19 restrictions than our west coast stores, but the shift away from cash use is definitely felt everywhere,” said Garbutt. “Even in our stores that remained open to in-store customers throughout 2020, like Perth, there was still a huge shift in consumers opting to pay contactless. With health concerns top of mind, people just don’t want to handle cash that others have touched — and honestly neither do we.”

With online ordering, contactless payments, curbside pickup, and no-contact deliveries becoming the norm for consumers across the country throughout 2020, Square’s data also shows that the share of Australian businesses accepting online payments on the platform has increased more than 1.5 times over the past year.

“Consumers have become accustomed to the ease and convenience of eCommerce over the course of the pandemic. This is likely a key factor contributing to the continued low levels of people paying with cash, despite restrictions being eased across the country,” said payments expert Professor Steve Worthington from Swinburne University Business School.

“A preference to minimise contact with physical currency is likely to be top of mind for consumers for quite some time. What’s more, with bank branch closures and fewer ATMs available, it has become more difficult to access cash and then to find places to spend it,” said Professor Worthington. “Combining that with the fact that many businesses favour digital payments for ease of use, speed, and security, there’s less incentive for any of us to carry cash now.”

The full report can be viewed here.

*Cashless is defined here as accepting 95 per cent or more of transactions through credit or debit cards.

Basiq and Personetics partner for one-on-one banking personalisation

Basiq, a financial API platform backed by Plaid, Westpac, Salesforce, and NAB has partnered with Personetics, the leading global provider of data-driven personalisation and customer engagement solutions for financial institutions. The partnership will offer a first-in-market solution to leverage open banking for personalisation based on an individual’s behaviours, preferences, and needs.

As consumers live out their lives and interact with their finances digitally, financial data has become increasingly powerful in tailoring financial services to an individual’s banking habits. In Australia, the government has mandated the opening up of this financial data under the Consumer Data Right (CDR). To date, only a handful of institutions have been accredited to receive data and the government is still in the process of developing a consumer awareness program.

Globally, Personetics has already delivered personalised digital banking experiences and is working with over 55 banks globally to boost customer engagement by up to 35% whilst also delivering a 20% increase in account growth and balances. To help accelerate innovation and realise consumer benefit, Basiq and Personetics have partnered for a first-in-market, turnkey solution that allows organisations to
leverage open banking data to deliver on the promise of personalisation.

With the Basiq and Personetics solution, organisations can immediately access real-time data from over 100 financial institutions across Australia and New Zealand. The joint solution will translate this data into personalised guidance on day-to-day money management, whether it’s encouraging healthy saving habits, guiding customers to pay off debt quickly, or proactively helping customers to move their money from low value to high-value accounts.

The Basiq platform is currently being used by over 200 banks and fintechs to aggregate and enrich data for use cases across financial advice, lending, payments and digital banking. Personetics has helped launch one of the first hyper-personalised bank offerings globally, working with Royal Bank of Canada on their digital assistant NOMI to provide customers with alerts, reminders, tailored insights, and automated savings based on their banking habits.

According to Basiq founder and CEO, Damir Cuca, data access, governance and analytics are a utility when it comes to leveraging open banking for personalisation.

“To personalise financial experiences at the individual level, organisations need an ongoing feed to real-time, aggregated data. This is no easy feat, especially as we’re seeing financial data becoming increasingly scattered. Basiq’s role is to take care of all the heavy lifting so that it’s possible to translate data into meaningful customer experiences.”

For Personetics Country Lead Australia & New Zealand, Mandeep Sandhu, the power of personalisation lies in the ability to nurture customers into financial wellness and is key to enabling real-time digital experiences.

“During Covid, our clients were able to proactively detect when their customers were at risk and help prevent financial hardship. By working together with Basiq, our vision is to localise these capabilities across the financial services ecosystem and to continue to push Australia as a global power-house for fintech and financial services.”

About Basiq:
Basiq is an open banking platform that helps people make smart financial decisions. Backed by NAB Ventures, Westpac Reinventure, Salesforce Ventures, and Plaid, we lead innovation in powering the next generation of financial services with access to secure and automated financial data.
With Basiq, fintechs can gain ongoing access to real-time data from +100 institutions. To date, we’ve helped a dozen banks and 200 fintechs across categories such as lending, payments, and digital banking.
Visit the website here.

About Personetics:
Focused on enabling proactive engagement for banks, Personetics’ AI analyzes financial data in real-time to understand customer financial behavior, anticipate customer needs and deliver a hyper-personalized experience.

With solutions designed for the mass market, wealth management, and small business customers, our technology enables banks to offer day-to-day insights, financial advice, and automated wellness programs to customers. Flagship clients include U.S. Bank (US), RBC (Canada), Santander (Spain, UK, Brazil), Metro Bank (UK), UOB (Japan, Singapore, Thailand), DBS (Singapore), MUFG (Japan).
Visit the website here.

Up makes money easy on TikTok with Australia first Gamified Effect

TikTok creators are today playing the first-ever Australian branded Gamified Effect thanks to a partnership between Up and TikTok. The new effect gives anyone on the TikTok platform the chance to play a 30-second game, munching as many coins as they can to show them who’s boss and potentially win a very real $1000.

Up’s Head of Product, Anson Parker said “It makes sense for Up to launch Australia’s first branded TikTok Gamified Effect. At the heart of Up is our goal to change the whole experience of saving and spending – because the more engaged and connected you are to your money, the easier it is to take control and build the life you want.

“Over the past 12 months, we’ve been using TikTok as a way to connect with existing customers and meet new ones. We’ve found TikTok to be an effective and engaging way to do that, and by leading Australia with new ways to use the platform we’ve been able to show our customers that having a sense of humour and being good with money aren’t mutually exclusive.” Anson said.

Brett Armstrong, TikTok’s General Manager of Global Business Solutions ANZ said “Up was one of the first brands we worked with when we launched our commercial business in Australia and they have always been open to trying new things and reimagining what’s possible for engaging with customers using TikTok. The ‘For You’ page on our platform gives the opportunity for any creator to go viral, and for branded creative effects like the one Up has launched with us today to be seen and used by our TikTok community all over the world. To see Up jumping at the chance to have a bit of fun with their customers is really surprising and unique for this category.”

The game will be live on TikTok from midnight, 20th March, and anyone can play and take a shot at the prize up until 31st March. The TikTok Gamified Branded Effect campaign is part of Up’s new brand platform, Easy Money. To launch the campaign Up has partnered with some of Australia’s biggest TikTok creators including Georgie and Zac, Emily Johnson, and Chantel Mila.

About Up

Up is Australia’s first and largest mobile-only digital bank. Up helps you control your money and simplify your life by giving you a range of financial superpowers you can use to spend wisely and save effortlessly. With no monthly fees, competitive interest rates, fast in-app signup, and instant access to Apple Pay™ and Google Pay™, Up is easy to try Australia-wide. We design and build experiences that customers didn’t think we’re possible in a bank, and features they didn’t know they needed. Learn more about Up at https://up.com.au

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