The impact of consumer behaviour in Switzerland on mobile payments adoption

Based on recent research, mobile payments in Switzerland are becoming increasingly popular due to a significant change in consumer behaviour.

Cashless payment methods have established themselves as a viable alternative to cash. As a result, currency usage has been decreasing for years, and individuals increasingly depend on different kinds of dematerialized payment. A growing number of people use bank cards as a method of payment for goods and services, and NFC technology allows you to pay for purchases in a contactless way with a mobile phone. Thus, we can confidently say that the cashless payment method makes a person’s daily life easier.

Switzerland is considered as one of the most powerful economic hubs on the planet, known for its advanced banking industry. However, in comparison with the trends of some other regions, mobile payments in Switzerland are not considered as a fast-growing area. Nevertheless, recent research conducted by the Lucerne University of Applied Sciences shows that the situation is undergoing changes.

According to recently released data, more than 40% of Swiss citizens over 15 years old has now enrolled in some kind of mobile payment service. Since last year, the number of mobile payments transactions has more than quadrupled in volume. Although geographical and gender variations still exist in the way this payment method is utilized for the purchasing process, there are some generalizations to be made.

Generally speaking, mobile payments conducted via smartphones and payment applications are becoming increasingly commonly accepted across Switzerland. Consumers often utilize this choice at the cash register, when transferring money to friends, when paying at a parking meter, and also when purchasing goods from e-commerce websites, among other places.

TWINT, the most widely-adopted provider, reported that it processed over 10 million payments in September 2020, which was the previous record. When comparing data from the previous year, it can be seen that the number of such transactions has more than quadrupled. As the Lucerne University of Applied Sciences and Arts’ Mobile Payment Study Switzerland 2020 shows, mobile payments are on the rise in Switzerland today. To conduct this detailed research, researchers examined data acquired from the Swiss National Bank as well as some anonymized data collected from the Swiss payment platform TWINT.

Andreas Dietrich, a research author from the Lucerne University of Applied Sciences, made the following observation: in Switzerland, mobile payments have gained popularity among the general population and are expected to continue to grow in significance in the future.

The Swiss mobile payment industry is seeing significant expansion, with TWINT boasting more than three million clients at the time of this posting. TWINT currently has more than 40 percent of the nation’s citizens over the age of 15 who have joined the application. In the nation as a whole, males are more likely than women to make mobile payments at the moment. This is a common occurrence of adoption behaviour in technical innovations, Dietrich explained, describing it as a common phenomenon of technology acceptance in technological breakthroughs.

It is important to mention, nevertheless, that females account for 45 percent of all mobile payment users in Switzerland, up from 36 percent only two years ago.

Regional variations in the use of mobile payments are also possible to see in the data. Consider that in seven Swiss cantons, more than half (50 percent) of the population older than 15 years old has enrolled in the TWINT app, for example (FR, ZG, AI, VD, SG, OW, and LU). However, there are certain cantons where TWINT users account for less than 30% of the population (BL, GL, BS, and AR). But on average, in all cantons, about one in every five (or 20 percent) registered TWINT mobile payments customers is still present.

Customers in Switzerland, similar to consumers in other areas of the globe, are buying more goods online and transacting through online sales platforms than they were before the COVID-19 outbreak started. Each six months, the volume of transactions conducted via the internet and mobile platforms more than doubles.

As a result of these technological adoption patterns, it is possible that the increase in virtual payments is related to long-term shifts in consumer behaviour or tastes, rather than just to the Coronavirus problem.

Furthermore, 228 million mobile payments transactions are anticipated to take place in Switzerland this year, according to the latest estimates. It is expected that about 30 million transactions will be conducted via mobile payment systems each month by September 2022, according to Dietrich.

In addition, by 2022, the TWINT platform plans to allow its users to make transactions not only within Switzerland but also to other European countries. This means that customers will be able to use their credit cards not only for domestic transactions, but also for transfers abroad. Furthermore, according to Money Today (business magazine), TWINT’s ambitions for many additional comfort and lifestyle functions such as food delivery, e-bike and e-scooter reservations, vehicle rentals, and insurance.

Therefore, it can be concluded that, despite the fact that the pace of the introduction of mobile payments in Switzerland lags behind some other regions, due to changes in consumer culture, this industry has promising prospects. And applications such as TWINT make a significant contribution to the popularization of mobile payments.