Exploring Italians' changing habits: one euro out of three is no longer paid in cash and smartphones become our favourite "wallets"

Exploring Italians' changing habits: one euro out of three is no longer paid in cash and smartphones become our favourite
A girl pays with her smartphone (Pierre Crom / Stringer / Getty Images)
18 Mar 21

Payments are increasingly digital, so much so that 33% of their total value in Italy today comes from cashless payment instruments. Despite the general decline in consumption (by over 13%) caused by restrictions and lockdowns to combat the pandemic, digital payments in 2020 reached 5.2 billion transactions worth a value of 268 billion euros. The percentage of digital payments, therefore, recorded a marked growth, given that the share was only 29% in 2019, in particular as a result of the more extensive spread of contactless payments (29%, at 81.5 billion euros) and, even more, of transactions through smartphones and wearable devices such as watches (80%, over 3.4 billion). Contactless payments have proven valuable against the spread of the COVID-19 pandemic.

This is the photograph taken by the Innovative Payments Observatory of the Milan Polytechnic - School of Management. Data contained in the study reveal how Italians' habits are changing, as digital payments have proven "important allies for citizens" during the pandemic, and "many Italians have come even closer to the world of eCommerce and online payments". Online product purchases recorded an increase of 31% in 2020, offset by a fall in the services category (47%), largely linked to the crisis in travels and tourism.

Smartphones and watches
Another fairly obvious news is that smartphones become the favourite devices for Italians as far as remote payments and online purchases, outdoing PCs. Mobile Commerce reaches 15.65 billion euros and 51% penetration of the total eCommerce: a sign of ever-greater ease and speed in using this device. Furthermore, among the most interesting innovations, there is also the increasing offer of digital services for home deliveries, enabled by digital payments, involving solutions such as sending a payment link by SMS, chat (Pay by link) or Mobile Wallet. Smartphone payments of bills, postal money orders and telephone top-ups are also growing (by 30% exceeding 1.15 billion euros). Overall, therefore, outside the shop Mobile Payments grow by 15% and reach 1.3 billion euros.

The tackle of SMEs
 A recent study by Visa also highlighted that 80% of transactions on its scheme are contactless and that eCommerce is increasingly popular in Europe, so much that in over ten countries the growth in online sales was 20% over the last year. For this reason, even small and medium-sized companies have begun to open themselves to opportunities related to digital transformation and specifically, to the eCommerce channels and digital payments (which are the fastest method for 66% of SMEs). And it is precisely in this context that Visa has launched the Where You Shop Matters program to support small businesses to develop digital skills, with over 100 European partners. For Italy, partners involve Banca Sella and Axerve, in particular concerning the possibility of accepting instruments for the various types of digital and mobile payments. Since the program was launched, more than two million small businesses have received support across Europe. The goal is to involve 8 million small and medium-sized enterprises in Europe and 50 million worldwide.

The HYPE business case 
 Going back to the survey's data on how Italian payment habits change, emblematic is the business case of Hype, the challenger bank born from the innovation platform of the Sella group, Sellalab, which today has over 1 million and 380 thousand customers. Hype in 2020 has grown much more than the whole market in the digital payments segment. Compared to 2019, Hype has grown by 65% on the total value of digital payments (physical by card, online or through an app) standing at over one billion euros, and by 49% on the number of transactions that reach almost 35 million. These figures show a particularly animated trend, against the market whose total value decreased by 0.7% and a 4% decrease in the number of transactions. The greatest growth was recorded by eCommerce transactions, which saw a 107% increase in volumes (from 8,861,211 in 2019 to 18,310,077 in 2020) and 104% in value (from over 302 million euros in 2019 to over 617 million in 2020) against a decrease in the market value by 3%. (The survey from the Observatory reported a 31% growth in purchases of online products, offset by a sharp decrease by 47% in services).

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