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The race for digital payments in Italy continues, reaching €327 billion by the end of 2021, 22% more than in 2020. The driving forces are contactless card payments (reaching €126.5 billion) and in-store payments via smartphones and other wearable devices (over €7 billion). Despite this, in terms of transactions per capita at European level, Italy was surpassed by Greece in 2019 and Germany in 2020, thus falling to 25th place (out of 27 countries), just ahead of Romania and Bulgaria. These are some of the findings highlighted by the latest Innovative Payments Observatory of the Politecnico di Milano School of Management.
An irreversible trend
Affected by the pandemic, Italians first shopped online and then reduced contacts to a minimum, and in 2021 Italians increasingly resorted to digital payments, which promoted an already ongoing trend related to technological innovation, which has long been established worldwide. Thus, in the second half of this year, despite the suspension of Cashback, one of the drivers of giving the most cash in 2020 and the first half of 2021 (Editor’s note: it is adopted by nearly 9 million Italians, about 18% of the adult population), Italians have demonstrated a decisive change in the pace of digitalization of payments, showing that there is no turning back in this regard.
According to the Polimi Innovative Payments Observatory, the 2021 budget ended with 327 billion euros in transactions (+22% on 2020) and a penetration rate of 38%, which means that almost 4 out of every 10 euros were paid by card. “The rebound effect is an important component compared to the 2020 pandemic emergency, but the growth is more significant in relative terms”, emphasizes Valeria Portale, director of the Innovative Payments Observatory. In fact, in 2021, the penetration of electronic payments for household consumption will reach 38%, an increase of 5 percentage points. It is therefore clear that the combined impact of the pandemic and consumer incentives has triggered a change in Italians’ habits. “
Leading in contactless cards, smartphones and wearables
The fear of physical contact favours contactless card payments (equivalent to €126.5 billion in 2021), which continued to lead in 2021, confirming themselves as the preferred method of payment for Italians in physical stores. This is a possible trend due to the increase in the limit for PINless payments from €25 to €50, which boosted the popularity of supported cards and POS.
But the fastest growing in stores are smartphone payments and wearable payments, ie payments made through wearable devices such as smartwatches, whose value actually exceeds 7 billion euros, doubling (+106%) compared to 2020. Greater diffusion is also confirmed by the reduction of payment thresholds, which fell from an average of 51.7 euros in revenue at the end of 2020 to 47.5 euros in 2021. In 2019 it was 53.7 euros.
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