Remember paying for things with cash? Nowadays, it can feel like a bit of a novelty. When the EFTPOS terminal is down at your favorite cafe, it feels a lot easier to find somewhere else than to scour your pockets for spare change.
But how often are you even whipping out your physical credit card?
The Reserve Bank of Australia (RBA) highlighted the shift away from physical payments in their 2022 Payments System Board Annual Report. Nearly 75% of purchases are made on card, be it debit or credit. Of these, 25% were made using mobile wallets. This has more than doubled from the 10% it was in 2020.
There has also been an upward trend in Buy Now Pay Later payments, particularly in line with the rising cost of living and widening array of payment options.
What payment platforms are available in Australia?
Not only are there a whole host of payment platforms available in Australia, but new ones are constantly being introduced.
For example, Live Payments has just launched a new payment platform for small businesses called LiveTap, where bigger contactless payment options may have been inaccessible.
Beyond that, you may have noticed all of the different options available to you at checkout over the past few years. From classic EFTPOS machines to sleek Square pads, phone plug-ins to counter-top tablets, tapping your card looks different than it did just a few years ago.
If you choose to use a mobile wallet, you’re spoiled for choice. Options vary depending on the make of your device (Apple Pay, Google Pay, Samsung Pay, etc) or whether you prefer your payments wearable.
Almost all banks will offer a digital card option for storage in a mobile wallet, including travel money cards and debit cards. Slot them alongside your digital license and Medicare card, and it’s no wonder they call it a mobile wallet!
Are there any risks to paying with mobile wallets?
In exchange for the convenience of not having to carry your card, there are some risks to keep in mind with mobile payments.
Although tapping eliminates the fear of card skimming that plagued many of us through the early 00s, it isn’t without risk. If you wouldn’t pay somewhere by inserting your card, you probably shouldn’t be tapping it either.
The Consumer Owned Banking Association (COBA) found that tap-and-go cashless payment methods were a driver of risky financial behavior, especially in those already struggling financially.
Their use for small payments can also make transactions difficult to track, meaning that fraudulent transactions can easily slip under the radar when it comes time to review your card statement. It’s important to stay vigilant in reviewing this, as data from the Australian Payments Network shows that 39% of credit card fraud victims were unaware that their cards had been compromised.
Checking your statements will also help you be mindful in your spending. A tap here, a tap there, and a tap here: too many taps really do add up. If you can’t trust yourself to stick to a budget while using a mobile wallet or tap-and-go card, it might be time for the most cruel and unusual tactic of all: going back to cash.
Stay updated on all things tech at our fintech hub. If you’re looking for a new card to add to your digital wallet, start comparing with the table below or check out Mozo’s best credit cards.
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