RBA CUS Publications (CARDS (MOBILE PAYMENTS (The 2016 survey provided…
RBA CUS Publications
Cards are increasingly being used for lower-value
transactions, reflecting the adoption of
contactless ‘tap and go’ functionality at the point of sale
The recent growth in the relative use of cards was strongest for lower-value transactions, with
consumers increasingly using debit (and to a lesser extent credit) cards for payments of $20 or
The recent increase in the frequency of card use relative to other payment methods (increased by 9 percentage points to 52 per cent) was almost entirely because cards were used more often for in-person payments; card use for online payments barely increased as a share of total payments in the 2016 survey (and the share of total payments made online was stable,
growth in the relative use
of cards was strongest for lower-value transactions, between 2013 and 2016, $20 or less.
Cards are now the most commonly
used payment method for all but the lowest-value
transactions (i.e. those of $10 or less
The use of cards for lower-value payments
has been facilitated by the rapid adoption of
contactless functionality by consumers and
merchants in recent years.
Around one-third of all
point-of-sale transactions were conducted using
contactless cards in 2016, which is 3½ times the
share reported by participants in the 2013
The 2016 survey provided some preliminary
insights into the use of mobile devices to make
card payments at the point of sale (mobile
Many respondents who did not use mobile payments
indicated that they were, at this stage, satisfied
with their current payment methods.
Most of the growth in contactless payments has been due to consumers tapping their ‘physical’
plastic cards at contactless terminals, with the ability to make tap-and-go payments using a mobile
phone still a relatively new feature of the Australian payments system
The ability to make mobile payments – whether provided via third-party mobile
wallets or banks’ proprietary banking applications – is a relatively new feature of the payments
landscape (and was not available for all card schemes and issuers at the time of the survey).
Consistent with this, mobile payments accounted for only around 1 per cent of the number of
point-of-sale transactions in the week of the survey (around 2 per cent of in-person card
The users of mobile payments were spread across a range of age groups and tended
to have above-average incomes
Nonetheless, it would not be surprising if the share of mobile payments were to increase in the
future as the availability of, and familiarity with, the technology expands.
In 2016, 85 per cent of survey
participants reported holding a contactless card, compared with two-thirds of respondents in 2013.
For lower-value transactions, particularly those of $10 or
less, contactless payments have mostly displaced cash (Figure 8). However, for payments over
$20, contactless payments have mostly replaced contact card payments
Consumers of all ages are using contactless cards more frequently than they did three years ago,
with nearly 60 per cent of participants in the 2016 CPS making at least one contactless card
payment during the week of the survey, compared with about one-third of participants in 2013.
Notably, the share of respondents aged 65 and over that made at least one contactless payment
more than doubled between 2013 and 2016 (Figure 9, top panel). But the use of contactless cards
does, on average, decline with age.
However, once older Australians have adopted contactless cards as a means of
payment – as indicated by having made at least one contactless card payment during the week –
the latest CPS suggests that there is little difference in how frequently they use them compared to
decline in the use of cash relative to other payment
methods since the 2013 survey mainly reflects
consumers switching to contactless cards for
cash was still frequently used for smaller transaction sand was the most common payment method for transactions of $10 or less (accounting for over 60 per cent of these payments)
some members of the
community make a substantial share of their
payments in cash, including older Australians and lower-income households.
these demographic groups have not, on average, adopted electronic payments as quickly as the
general population, they are nonetheless using
cash for a smaller share of transactions than in
Reasons for using cash:
- Merchant acceptance, fees and pricing
- Consumer preferences and habits.
participants who used cash most intensively,
consumer preferences were more important
than factors relating to merchant acceptance
around 20% of respondents were not holding any cash in their wallets at the beginning of the survey week (compared with 8 per cent in 2013
In 2016, around 70 per cent of survey
participants reported holding some Cash outside
of their wallet, compared with about 75 per cent
contributor has been an increase in the use of cards for in-person payments, although other
factors have played a role. For example, between 2007 and 2013 an increasing share of consumer
payments were made via ‘remote’ payment channels – e.g. online card payments.
The use of personal cheques continued to
decline, with cheques accounting for only 0.2 per
cent of payments made by participants in the
2016 survey, compared with 0.4 per cent in 2013
and 1.2 per cent in 2007.
However, 12 per cent
of respondents said they had made at least one
personal cheque payment in the year prior to the
around 70 per cent of the small
number of cheque payments recorded in the
2016 survey were made by participants aged 65
Nonetheless, fewer cheques are being
written by consumers of all ages
For the most
part, those households that continue to use
cheques report that they do so because some
merchants prefer to be paid by cheque, there is
no alternative for that particular type of payment or because cheques provide a useful record of
This article discusses key findings of the 2016
Consumer Payments Survey, focusing on:
- consumers’ use and holdings of cash;
- trends in payment card use;
- the use of personal
The survey showed that Australian consumers
are continuing to switch to electronic payment
methods in preference to paper-based methods
– cash and cheques – for their transactions.
Although there are some notable differences in the payment patterns of different demographic
groups, the move towards electronic means of payment has been evident quite broadly.