Australian consumers are embracing mobile wallets at a rapid pace

More and more Australian consumers are relying primarily on mobile wallets, which are on track to replace bank cards within seven years. 

Reserve Bank of Australia data shows payments using mobile wallets accounted for 11 per cent of retail sales in 2020, surging to 35 per cent in three years later, in 2023. Mobile wallets could surpass retail card payments by 2032 if current trends continue, according to Peter Drennan, research and data expert at Australian financial comparison platform Money.

“We’re seeing a glimpse into a future where your phone is your entire wallet and all transactions are made via a mobile phone, smartwatch or other device,” he said. 

“Unlike physical cards, which can be forgotten, lost, or stolen, e-wallets provide a more convenient alternative for everyday payments.” 

In October, more than 500 million mobile wallet transactions totalled $20 billion, according to latest RBA data. However, with mobile wallet usage at 37 per cent, the adoption rate could be slowing.

Drennan said mobile wallet providers such as Apple Pay and Google Pay must develop tactics to maintain fast adoption rates.

Furthermore, there is a significant variation in the size of transactions done using mobile wallets compared to traditional cards. The current average transaction value for mobile wallets is $40, which is much lower than the $84 average for non-mobile wallet transactions.

“Younger generations are more inclined to set up e-wallets and use them for small transactions, which likely results in a smaller average spend. I’d also assume that people still tend to reach for a physical card when making larger transactions,” Drennan added. 

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