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Home Featured

The Future of Contactless Payments in a Cashless Economy

Lara Randle by Lara Randle
August 29, 2025
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Handling physical cash is not only inefficient but also expensive. For businesses, managing cash adds overhead costs and risks, including theft, reconciliation errors, and a lack of transaction records.

These issues erode profitability and limit access to credit, hindering business growth. Moreover, cash-heavy systems perpetuate informality in the economy, reducing tax revenues and obscuring economic activity. It was inevitable that both public and private sectors turned to digital alternatives—particularly contactless payments —as a smarter and more scalable solution

Over the past decade, the adoption of contactless payments has accelerated at an unprecedented pace. These systems offer unparalleled convenience, speed, and security, fueling their adoption in both advanced and emerging markets. Digital payments economy in Africa is expected to reach $1.5 trillion by 2030, fueled by rapid adoption of real-time payment systems, cross-border digital platforms, and inclusive payment technologies.

Innovations like low-cost smart feature phones turned into digital wallets and tap-on-phone solutions that convert smartphones into POS devices are ensuring that technology access doesn’t become a barrier to financial inclusion.

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In Nigeria, these tools enable small businesses to accept contactless payments through mobile apps, QR codes, or simple payment links.  Digital wallets like Apple Pay, Google Pay, and Samsung Pay have further solidified the role of contactless payments by integrating them with mobile devices that consumers use daily.

Initially seen as a convenience for quick, low-value transactions, contactless payments have evolved into a standard expectation. Consumers have demonstrated a clear preference for faster, more seamless payment methods, with reports indicating that contactless payments now account for over half of in-store transactions in several major economies. In the United Kingdom, for instance, contactless payments comprised 65% of all debit card transactions in 2022.

The global pandemic had accelerated this shift, as both businesses and consumers prioritized hygiene in their payment interactions. While cash was once considered king, it quickly became a liability, perceived as a potential carrier of germs.

This behavioral change led to significant growth in contactless payment adoption, even among demographics that had been slow to embrace new payment technologies. Retailers adapted swiftly, updating their point-of-sale systems and increasing transaction limits to accommodate higher-value purchases through contactless methods.

Contactless payments has been integrated into public transportation systems in many countries, and is expected to expand into other sectors, such as healthcare, education, and government services, where contactless payments can streamline processes and reduce administrative overhead.

There are still obstacles preventing contactless payments from scaling, including regulatory support and drive, industry collaboration, resistance to change due to unconvincing value proposition, and lack of customer awareness and trust.

Some individuals resist change due to unconvincing value propositions or concerns about security. A few years ago, there was a viral video on a text chain social media app on the risk of contactless payment channels. This had triggered fear of scams in cardholders and digital wallet holders.

To address these concerns, investments in encryption, tokenization, and biometric verification are crucial to safeguard consumers. Targeted awareness campaigns and community-based education on contactless payments, cybersecurity, and fraud prevention are also essential, particularly for new users.

Regulation plays a vital role in driving the evolution of contactless payments. Central banks must drive initiatives to encourage adoption of contactless payments. Clear guidelines on data privacy, transaction limits, and fraud mitigation are necessary to build a robust framework that supports growth, and the industry must collaborate to share data responsibly, with safeguards in place to protect consumer privacy.

The infrastructure and security of contactless payments already exist; the biggest barrier is simply changing habits and incentives to change that habit.

Africa is uniquely positioned to leapfrog outdated banking models and build a mobile-first, contactless financial ecosystem. With a young population, rising smartphone adoption, and a vibrant fintech sector, the continent is on the path to a largely cashless future.

Initiatives across Nigeria, Kenya, South Africa, and beyond are laying the groundwork for inclusive, scalable, and secure contactless payment infrastructure. As governments and innovators align, the continent can unlock unprecedented economic participation, especially for women, youth, and informal workers. The future of payments in Africa isn’t just digital it’s contactless, accessible, and empowering. And that future is well underway.

Tags: Africacashless economycontactless paymentsdigital paymentsFinancial inclusionFintechmobile payments
Lara Randle

Lara Randle

Lara Randle, Director of Technology Account Management at Mastercard, is a seasoned payments professional with 16+ years of experience driving innovation across Nigeria and Africa. At Mastercard, she leads optimization projects, training initiatives, and supports the “Force for Good” program. With 12 years in banking, she pioneered solutions such as contactless card migration and instant card issuance at GTBank. Lara holds a BSc in Marine Biology, an MSc in Dispute Resolution (University of Lagos), and executive certifications from Harvard Business School Online and Tuck Executive Education. Beyond work, she is a mental health advocate, crossword enthusiast, and global traveler.

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