COVID-19 outbreak pushes China towards cashless economy 

The online payment growth is likely to shift consumer behavior so that even when cash payments are safe again they will keep on facing a gradual decline in value and volume

cashless economy

COVID-19 outbreak pushes China towards cashless economy. Source: flickr.com

The cash transactions across China will face significant decline whereas card payments continue to increase over the next four years, according to GlobalData.

The report states that the growth rate for the value of cash transactions before and after the pandemic will drop from a compound annual growth rate (CAGR) of 5% to -4.3%, between 2019 and 2023. The forecast also predicts that the value of card transactions will rise up to 2023, although the post-COVID-19 amended forecasts see a CAGR drop to 10% from 11.8%.

Besides, the shift in annual decline has already been seen because of a rise in online shopping and larger food orders for stockpiling. Furthermore, the World Health Organisation urged to use cards since contactless payments are much safer than cash ones amid the COVID-19 outbreak.

GlobalData has revised its forecasts for payment card transaction value and volume data for the next five years, anticipating a steep reduction in projected growth for 2020, which will ultimately recover but not to previously forecast levels. This is due to the impact in the short to medium term of what is looking likely to be a global economic recession
Ravi Sharma, Banking and Payments Analyst at GlobalData

SEE ALSO:

 

facebook