French contactless payment limit raised to €30 from €20
From next month through to September, France will raise the limit on contactless transactions to €30 ($32.27) from €20. During this period, contactless terminals will be reconfigured and consumers will receive new cards which are permitted to access the new limit. Although contactless accounts for just 10% of payments in France, increasing the limit could encourage users to pay with contactless more frequently. In 2015, the UK raised its limit on contactless payments and saw contactless leap from 8% of card payments to 19% within a year. However, in France just 40% of customers are expected to upgrade by late 2018.
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France is poised to raise the limit on contactless transactions to €30 ($32.27) from €20, according to The Connexion.

That increase will be rolled out in stages — next month through September, terminals will be reconfigured, and then after that, customers will begin receiving the new cards that will be required to access the new limit.

That could make it a long-term process, since re-issuing cards is both time consuming and expensive — just 40% of customers are expected to be upgraded by the end of 2018.

Increasing the contactless limit could boost usage.

It could spur habit formations. Contactless transactions currently accounts for about 10% of payments in France. It’s most popular at supermarkets, fast food restaurants, and boulangeries. Raising the limit could allow users to pay contactlessly more frequently, or to use the technology for a wider variety of purchases, since increasing the limit adds to the share of buying that consumers are able to do contactlessly. That could bring more frequent day-to-day usage, and ultimately, habit formation.

Contactless transactions currently accounts for about 10% of payments in France. It’s most popular at supermarkets, fast food restaurants, and boulangeries. Raising the limit could allow users to pay contactlessly more frequently, or to use the technology for a wider variety of purchases, since increasing the limit adds to the share of buying that consumers are able to do contactlessly. That could bring more frequent day-to-day usage, and ultimately, habit formation. We’ve seen this in other markets. The UK raised the contactless limit in September 2015 by a similar amount, so that it included the average price of a basket of groceries. Since then, there’s been a massive increase in usage. In July 2015, two months before the limit increase, contactless usage was just 8% of card payments in the UK. A year later, it comprised 19%, and now it’s over a quarter. It’s likely a similar scenario could occur in France.

That could also be a boost to mobile wallets. As of mid-last-year, over half of French adults had not yet made an in-store mobile payment. But over a quarter of adults felt ready to do so, indicating appetite for contactless payment methods. Wider contactless card popularity could help more users familiarize with “tapping to pay,” and as more French financial institutions get on board with mobile wallets, we could see users starting to convert and the offerings becoming more popular.

Mobile payments are becoming more popular, but they still face some high barriers, such as consumers' continued loyalty to traditional payment methods and fragmented acceptance among merchants. But as loyalty programs are integrated and more consumers rely on their mobile wallets for other features like in-app payments, adoption and usage will surge over the next few years.

BI Intelligence, Business Insider's premium research service, has compiled a detailed report on mobile payments that forecasts the growth of in-store mobile payments in the U.S., analyzes the performance of major mobile wallets like Apple Pay, Android Pay, and Samsung Pay, and addresses the barriers holding mobile payments back as well as the benefits that will propel adoption.

Here are some key takeaways from the report:

In our latest US in-store mobile payments forecast, we find that volume will reach $75 billion this year. We expect volume to pick up significantly by 2020, reaching $503 billion. This reflects a compound annual growth rate (CAGR) of 80% between 2015 and 2020.

Consumer interest is the primary barrier to mobile payments adoption. Surveys indicate that the issue is less the mobile wallet itself and more that people remain loyal to traditional payment methods and show little enthusiasm for picking up new habits.

Integrated loyalty programs and other add-on features will be key to mobile wallets taking off. Consumers are showing interest in wallets with integrated loyalty programs. Other potential add-ons, like in-app, in-browser, and P2P payments, will also start fueling adoption. This strategy has been proved successful in China with platforms like WeChat and Alipay.

In full, the report:



Forecasts the growth of US in-store mobile payments volume and users through 2020.

Measures mobile wallet user engagement by forecasting mobile payments' share of their annual retail spending.

Reviews the performance of major mobile wallets like Apple Pay and Samsung Pay.

Addresses the key barriers that are preventing mobile in-store payments from taking off.

Identifies the growth drivers that will ultimately carve a path for mainstream adoption.

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