As in just about every industry, COVID-19 has had a fundamental impact on payment methods – and, more specifically, consumer behaviour and attitudes around payment methods. The impact, however, has not been entirely negative for the industry. Rather, it has largely injected added impetus to trends and changes that were already underway. Around half of all Irish consumers say that COVID-19 has caused them to change their preferred payment methods, with significantly increased card usage alongside a dramatic reduction in cash usage. This is partly because consumers are making efforts to reduce the time they spend in physical retail outlets, while shopping more online or, to a lesser extent, using click-and-collect facilities. However, it is also due to a high level of anxiety around notes and coins – almost three quarters agree that the COVID-19 outbreak has raised hygiene issues with cash; more than half of Republic of Ireland (RoI) consumers and over a third of Northern Ireland (NI) consumers trying to avoid using cash where possible. From the perspective of payments, the legacy of COVID-19 will likely be the even greater shift towards cards – and contactless payments, in particular – e-payments and even bank transfers at the expense of cash and cheques.

• The impact of COVID-19 on consumer behaviour with respect to payment methods.

• Payments used most often by Irish consumers both in-store and online.

• Factors that consumers take into consideration when deciding which payment method to use when making both low-value and high-value purchases.

• How often consumers carry cash, and which consumers carry cash most often.

• Consumer payment behaviour and attitudes towards payment methods.

This update on the impact that COVID-19 is having on the market was prepared on 16 October, 2020.

In RoI, the first COVID-19 case was confirmed on 29 February, with a small number of cases in the following days. The first recorded death related to COVID-19 was confirmed on 11 March. On 12 March, it was announced that all schools, colleges and childcare facilities were to close until 29 March. On 16 March, the RoI government established the Pandemic Unemployment Payment (PUP). As cases continued to rise, tighter restrictions were introduced, culminating in a full lockdown on 27 March. On 5 May, the RoI government announced a five-phase roadmap detailing the gradual reopening of the economy between 18 May and 10 August. However, a deterioration in terms of active cases occurred through September and the first half of October, resulting in a formal recommendation by the RoI’s National Public Health Emergency Team (NPHET) for a return to a full – or Level 5 – lockdown. This would mean no family or social gatherings; only essential retail permitted to open; no indoor gatherings; no sporting fixtures or events; and all bars, cafes and restaurants closed, except for deliveries or takeaways. At the time of writing, the RoI government has not yet made a decision on this advice.

The first COVID-19 case was confirmed in the UK at the end of January, with a small number of cases in February. The initial strategy was one of containment, with the UK (including NI) continuing to operate much as normal. The first case in NI was confirmed on 27 February. As the case level rose, the UK government ordered the closure of non-essential stores on 20 March. A wider lockdown requiring people to stay at home except for essential shopping, exercise and work ‘if absolutely necessary’ followed on 23 March. Initially, a three-week timeframe was put on the measures, which was extended in mid-April for another three weeks.

Through May and early June, the NI Executive eased some restrictions relating to social gathering and the reopening of certain businesses. Although the case-count remained low and under control during the summer months, the situation deteriorated in September and October with cases spiralling upwards. On 14 October, an intensive four-week period of restrictions was announced. The entire hospitality sector closed for four weeks, while schools closed for two weeks and all unnecessary travel was prohibited. Under the new rules, takeaways and deliveries are allowed but pubs and restaurants must close for the four-week period. While the retail sector will stay open, close-contact services – such as hairdressers and beauticians – are required to close.

This Report examines consumer behaviour and preferences when it comes to payment methods. This includes all payment methods used in-store and online.

The payment methods examined in this Report include:

• debit cards

• credit cards

• cash

• e-payments

• payment services via smartphones or other devices

• direct debits/standing orders

• bank transfers

• cheques