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GlobalData is revising its forecasts for payment card transaction value and volume for the next four years, anticipating a reduction in projected growth for 2020. This will ultimately recover – but not to previously forecast levels.

The rising demand for non-cash payments is expected to drive card payments at point of sale (POS) terminals and will result in a decline in ATM cash withdrawals.

With a relatively modest death toll of 9,000 Covid deaths by mid-August, Germany is the one major European country to have tackled the virus effectively. Such a death toll equates to a 110 deaths per 1 million residents.

In the other major European markets, the corresponding figures are sobering. Spain reports 29,000 deaths (612 deaths per 1 million) just ahead of the UK with 42,000 deaths for 609 per 1 million. Italy and France with 36,000 and 31,000 deaths respectively results in 586 and 507 deaths per 1 million residents.

Germany does not escape revised forecasts for the card sector post-Covid but the revisions are modest. GlobalData now forecasts the number of German card payments will grow by 3.3% in 2020 with a 2.9% decline in ATM cash withdrawals.

According to the German Credit Agency, over half of card payments made are now contactless, compared to 35% before the pandemic.

To encourage the shift away from cash, contactless payment limits across several European countries (including Germany) have been raised. The new limit in Germany is €50 ($56.14), up from €25.

In Spain, cash has traditionally been a popular payment instrument, accounting for over 60% of total transaction volume. But according to a study carried out by digital-only bank N26, cash withdrawals in Spain fell by 68% in March 2020.

As per our revised forecasts, the number of card payments in Spain will grow by 2.3% in 200 with ATM cash withdrawals set to drop by 4.4%.

To promote online sales, CaixaBank launched Social Commerce, a new online solution enabling merchants to sell their products on social networks including Facebook, Twitter, Instagram, WhatsApp, and Telegram.

The pandemic is also pushing the use of prepaid cards. For example, CaixaBank extended its partnership with the government to distribute 200,000 social welfare prepaid cards aimed at recipients who are struggling to access their benefits due to the current situation.

In Italy, the pandemic has had a severe impact on the country’s tourism sector, which accounts for around 13% of GDP. According to the Italian tourism association Assoturismo Confesercenti, €200m worth of travel and accommodation bookings were cancelled in March alone. Key tourist destinations such as Rome and Sicily registered travel booking cancellations of as high as 90%.

Cash has historically been the preferred method of payments in Italy and is at the heart of the Italian economy, accounting for 78.5% of total payment transaction volume in 2019. But this is changing due to the outbreak.

The Italian prepaid card market will benefit due to the pandemic, as the Municipality of Milan selected Mastercard branded Soldo’s prepaid card to distribute emergency aid to vulnerable citizens.

Milan was the first authority to adopt Soldo Care, and uses the cards to help distribute its portion of the Italian government’s €400m solidarity fund. A further 21 Italian authorities have signed up to use the cards to distribute emergency aid in their regions.

As per GlobalData’s revised forecasts the number of card payments in Italy will grow by 2.2% in 2020, compared to a drop of 3.6% in ATM cash withdrawals.

As in Italy, France is being hammered as a result of a major loss of travel and tourism revenue. According to Jean-Baptiste Lemoyne, the secretary of state for tourism, the French travel and tourism industry is estimated to have lost around €10bn in the first four months of 2020. Paris alone has witnessed a 70% drop in hotel bookings and a loss of 30% in revenue since the beginning of the crisis.

According to GlobalData’s revised forecasts, the number of card payments in France will grow by 1.6% in 2020, with a simultaneous decline of 6.3% in ATM cash withdrawals.

An even sharper drop in ATM withdrawals is forecast in the UK. The equivalent UK figures are for card payments to grow by 1.7% in 2020, with a decline of 7.7% in ATM cash withdrawals.

With a relatively modest death toll of 9,000 Covid deaths by mid-August, Germany is the one major European country to have tackled the virus effectively. Such a death toll equates to a 110 deaths per 1 million residents.

In the other major European markets, the corresponding figures are sobering. Spain reports 29,000 deaths (612 deaths per 1 million) just ahead of the UK with 42,000 deaths for 609 per 1 million. Italy and France with 36,000 and 31,000 deaths respectively results in 586 and 507 deaths per 1 million residents.

Germany does not escape revised forecasts for the card sector post-Covid but the revisions are modest. GlobalData now forecasts the number of German card payments will grow by 3.3% in 2020 with a 2.9% decline in ATM cash withdrawals.

According to the German Credit Agency, over half of card payments made are now contactless, compared to 35% before the pandemic.

To encourage the shift away from cash, contactless payment limits across several European countries (including Germany) have been raised. The new limit in Germany is €50 ($56.14), up from €25.

In Spain, cash has traditionally been a popular payment instrument, accounting for over 60% of total transaction volume. But according to a study carried out by digital-only bank N26, cash withdrawals in Spain fell by 68% in March 2020.

As per our revised forecasts, the number of card payments in Spain will grow by 2.3% in 200 with ATM cash withdrawals set to drop by 4.4%.

To promote online sales, CaixaBank launched Social Commerce, a new online solution enabling merchants to sell their products on social networks including Facebook, Twitter, Instagram, WhatsApp, and Telegram.