MasterCard has announced 150 per cent year-on-year growth for MasterCard and Maestro contactless transactions in Europe, suggesting that contactless payments technology is increasingly attractive to European consumers. But what's in it for corporates and banks?

It's no surprise that 2015 was a game-changing year for mobile payments. Services such as Apple Pay and Android Pay, as well as similar offerings from Samsung, Walmart, LG and Microsoft, flooded the market, making it easier for shoppers to tap and buy.

Last year was also when the total number of MasterCard and Maestro processed transactions passed the 1 billion mark, representing an increase of 150% compared to 2014. MasterCard also announced that, on average, 13 per cent of its in-store transactions are now contactless (as of Q4 2015), while spend on contactless transactions increased by 183 per cent in 2015 compared to the previous year.

Contactless payments quicker and convenient

While contactless payments are quicker and more convenient for shoppers, they are also a safer alternative to cash, according to MasterCard, with multi-layered, state-of-the-art security.

There is no doubt that contactless is catching on quickly. More than 10 European countries offer consumers contactless cards or devices, with more than 5 million such devices/cards in circulation in each country. Last year also saw a 72 per cent increase in the number of contactless merchant locations.

Across Europe, the take-up of contactless payments varies in different countries, with 77 per cent of in-store transactions processed by MasterCard being contactless in the Czech Republic, compared to 9 per cent in the Netherlands.

Why corporates need to get on the contactless payments bandwagon

So what does all this mean for banks and corporates?

In the retail space, corporates are well aware that offering contactless payments to customers improves the shopping experience, saves time and simplifies check-out. Several other aspects of contactless payments can also be attractive to consumers, thereby improving the consumer-retailer relationship.

For example, one of the enhanced services that can be offered through contactless payments applications is pay by instalments, whereby a bank's own banking app enables a consumer to turn a payment into an instalment plan. This has benefits for both the consumer and the retailer but also for the payments service provider, which can gain revenue from the instalments plan.

New revenue streams and customer loyalty

Some apps and contactless cards also offer receipts management, which enables the customer to store receipts digitally for better financial management or reconciliation. It's a feature that could increase customer loyalty to a certain retailer or payments provider.

Loyalty schemes associated with contactless cards, devices and applications also increase 'stickiness' between customer and card provider or retailer, while also providing useful data on consumer trends, which can be used to drive future revenue streams.

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CTMFile take: It's clear that mobile and contactless payments is too big an opportunity to miss for corporates with consumer-facing businesses as well as for corporate expenses.