Travelers
turning to digital payments over cash
Cash is still the most popular payment
method when people are traveling outside their country. A study found that
77 percent of travelers still prefer to rely on cash.
However, the study also claims that the
use of cash is increasingly causing anxiety and stress, with the loss or theft
of cash a top concern.
One reason for this is that many people
still feel they need to carry more cash abroad than they would generally be
comfortable with. Almost three-quarters of travellers (72%) said they keep the
foreign currency they will need before leaving.
On an average traveler spends $1,793
per trip, and many will not top up their cash once they arrive. Just 1 person
in 10 makes an ATM withdrawal at their destination; with nearly 20 percent of travellers
take the security of ATMs in unfamiliar locations as a barrier.
There is also the question of what to
do with remaining cash. Despite the fact that spending outpaces the amount of
cash taken, almost 9 in 10 travelers (87 percent) still have cash left over
after their trip. Less than one-third convert it back into their home currency,
which means many are left with significant amounts of unused cash.
Lessons for the
payments industry
Changing travel trends may also have an
impact on people's attitudes to cash. Visa's survey found that overseas trips
are on the rise, with respondents planning an average of 2.7 foreign trips over
the next two years, up from 2.5 during the previous two years.
While Visa certainly has a vested
interest in promoting the use of card payments among travelers, the survey
highlights the importance of providing payments choice to tourists and business
travelers alike.
Some debit, credit and prepayment
cards, for example, now allow users to pay in local currency, thereby avoiding
hidden fees and benefiting from more competitive exchange rates.
But options for payments when on
vacation may not be limited to credit and debit cards. Tools such as mobile and
contactless are increasingly popular options, and people will expect to be able
to use these when abroad just as they would at home.
Indeed, Visa found that travelers are
increasingly relying on technology when in foreign countries, with 88 percent
of respondents gaining online access while abroad, up from 78 percent in 2015.
With 44 percent using ride-sharing apps
to get around once they reach their destination, for example, there is no
reason to think that payments will be any different.
Cash isn’t going anywhere for
travelers, with its convenience and ubiquity it can be particularly useful when
people are in unfamiliar locations. But with mobile and digital options gaining
popularity around the world, we can expect more people to rely on these payment
methods when traveling outside their home country.
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