Payments Snapshot in Australia: Coronavirus (COVID-19) Sector Impact

Payments Snapshot in Australia: Coronavirus (COVID-19) Sector Impact

Summary

The Coronavirus (SARS-CoV-2) outbreak, dubbed COVID-19, is first and foremost a human tragedy, affecting millions of people globally. The contagious Coronavirus, which broke out at the close of 2019, has led to a medical emergency across the world, with the World Health Organization officially declaring the novel Coronavirus a pandemic on March 11, 2020.

In an attempt to avoid contraction in the overall economy, the government has so far announced two economic packages. The first, unveiled on March 12, is a A$17.6bn ($12.4bn) stimulus package, including tax relief for small businesses and one-off cash payments. The second is a A$66bn ($46.4bn) ‘safety net’ economic package that provides cash payments for SMEs as well as financial assistance for households, retirees, and sole traders.

In addition, the Reserve Bank of Australia (RBA) twice reduced the bank interest rate in March - each time by 25 basis points, with the bank rate now at a historic low of 0.25%. The RBA will also disburse at least A$90bn ($63.3bn) to banks over a three-year period at 0.25% for SME lending.

This report focuses on the impact of the Coronavirus outbreak on both the economyand the cards and payments industry in Australia. Based on our proprietary datasets, the snapshotprovides a detailed comparison between pre-COVID-19 forecasts andrevised forecasts of total payment card, debit card, and credit and charge card transactions by value and volume. It also offers information on measures taken by the government to combat Coronavirus.

Scope

- According to estimates by the Tourism and Transport Forum, Australia could potentially lose A$5.64bn ($3.96bn) in inbound tourism receipts from Chinese visitors alone for the period of January-May 2020 in the wake of the crisis.
- Australia is one of the most highly developed contactless card markets in the world, with the majority of consumers having access to a contactless payment card. As a result of the current scenario, the use of contactless cards for payments is expected to become even more popular in Australia.
- The epidemic is also a testing time for the country’s previously blooming buy now, pay later industry, with increasing unemployment and reduced consumer spending impacting the ability and desire of consumers to purchase goods on credit.

Reasons to Buy

- Make strategic decisions using top-level revised forecast data on the Australian payment industry.
- Understand the key market trends, challenges, and opportunities in the Australian cards and payments industry.
- Receive a comprehensive insight into payments market in Australia.