French consumers now spend less and gradually renounce cash

The fact that all restaurants, bars, shopping malls, etc across the country shut since March means that consumer spending has already dropped significantly

cash transactions

French consumers now spend less and gradually renounce cash. Source: pixabay.com

According to GlobalData, cash transactions in France are expected to change from steady growth to yearly declines by 2023. Besides, they are currently set to drop at a compound annual growth rate (CAGR) of -2.3% up to 2023.

Despite French e-commerce is seeing increases, its payments industry will be hit by ongoing disruption to its essential tourism industry, the report found.

The report highlighted that the French tourism industry is particularly reliant on Chinese consumers. For instance, 2.2 million visitors per year spend $4.4 billion as of 2019. And due to the pandemic, there have been no Chinese visitors since February, meaning a drastic reduction in consumer spending.

Payments companies will lose out on significant business in consumer spending from sectors such as travel and tourism, accommodation and retail. It is essential to them that the outbreak is contained at the earliest. They will be watching countries ahead of France in the curve, such as China and South Korea, to see how things evolve when they relax the severe lockdown measures
Ravi Sharma, Banking and Payments Analyst at GlobalData

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