Australia projected to be 98% cashless by 2024
The Australian economy is projected to be 98% cashless by 2024, according to the annual Global Payments Report from FIS. The report examines current and future payment trends across 41 countries, and found that global trends in digital commerce accelerated during the COVID-19 pandemic. Consumers around the world have begun to prefer digital payment methods at the point of sale (POS), leading countries like Australia towards a predominantly cashless future.
FIS predicts that Australia will be at the forefront of the transition towards alternative payment methods, with buy now pay later (BNPL) options continuing to claim market share and doubling from 9.5% in 2020 to almost 20% in 2024. Cash payments for in-store purchases are also forecast to decline from 8.3% of transactions in 2020 to 2.1% by 2024, making Australia the fourth most cash-averse economy after Sweden (0.4%), Denmark (0.8%) and Hong Kong (1.6%).
The FIS report predicts that the use of a digital wallet at the POS will increase from 8.1% of in-store transactions in 2020 to 15.5% of payments over the next four years. Debit cards are forecast to remain a popular choice at the point of sale, accounting for 40% of purchases in 2020.
Australia’s e-commerce market is expected to grow 48% from US$37 billion in 2020 to US$54 billion in 2024. The growth in Australian e-commerce is driven by mobile payments, projected to account for 31% of all online transactions in 2024, compared to 24% in 2020. BNPL methods are growing at 32% annually in Australia, and are forecast to represent 20% of the e-commerce market by 2024.
Phil Pomford, General Manager (APAC) Worldpay Merchant Solutions at FIS, said Australian consumers are ushering in a new dawn of commerce, as they embrace modern ways to pay, consume and engage with businesses.
“As Australia heads towards a predominantly cashless payments market, we must focus on financial inclusion. Important parts of the economy continue to rely on cash, such as charity donations and restaurant tip jars. Further, fintechs and regulators need to collaborate to build new frameworks that allow for this rapid shift and use technology to boost financial inclusion for underserved communities,” said Pomford.
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