Covid accelerated digital transformation, says Fintech firm

Previously emerging Fintech and payments trends have experienced a “massive acceleration” as a result of the COVID-19 outbreak, according to Fintech firm PPRO

The team at PPRO, a Fintech firm that allows consumers to pay with the local payment methods they “trust and know, wherever they are,” notes that it’s been a year of “momentous change” for the payments sector.

PPRO pointed out that previously emerging Fintech and payments trends have experienced a “massive acceleration” as a result of the COVID-19 outbreak. Cash usage, for example, declined even further (globally, on average) this past year following rumours that handling paper currency notes may spread infection.

In March 2020 (when awareness about COVID became more widespread), ATM withdrawals in the United Kingdom fell by 60%, which led to predictions that cash payments will fall to merely 9% of all transactions by 2028. McKinsey’s 2020 Global Payments Report notes that by the end of last year, there may have been a drop of 4 to 5 percentage points in the share or number of global transactions settled with cash.

PPRO noted that the Coronavirus crisis has been “rocket fuel” for digital transformation, offering an opportunity for the payments sector to continue innovating at a rapid pace. Last year, online or digital payments through bank transfers continued to become more widely-adopted, while Buy Now, Pay Later (BNPL) services became one of the fastest-growing online payment methods for UK customers and worldwide, PPRO revealed.

As noted by PPRO: It is safe to say local and alternative payment methods – any payment method other than credit or debit cards – have seen huge growth over the last couple of years. These local payment methods (LPMs) continue to play a key role in accelerating cash substitution, particularly in developing countries. In China, for example, LPMs generated $43 billion in revenue in 2019.