Mobile payment is ahead of a breakthrough in Hungary

About five years ago Apple Pay and Android Pay broke new ground in contactless mobile payment, especially in Western Europe. However, it is still early days in Hungary in this regard – the new payment solution hasn’t really spread yet. According to the Central Bank of Hungary (MNB), the proportion of cash payment is still 75 percent in Hungary. At the same time in China cash use dropped from 96 to 45 percent between 2012 and 2019.

In Hungary we can use our mobile phones for paying since the early 2000s, e.g. paying for parking via SMS. The appearance of mobiles with an NFC feature and Apple announcing the launch of Apple Pay at the end of 2014 started the era of contactless mobile payment. Soon Google, Samsung and LG also came out with their own systems and bank cards ‘moved in’ our smartphones.

The introduction of instant payment (QR code payment) and the market entry of payment initiation service providers (PISP) due to the launch of PSD 2 can give new impetus to mobile payment. Besides, the Hungarian debut of AliPay and the imminent launch of Google Pay can also entail the spreading of mobile payment. Although Android-based mobile payment has been available from 7 financial service providers in Hungary since September 2016, these mobile wallet solutions haven’t been able to break through yet.

Lidl’s mobile app Lidl Plus was launched in Denmark, Austria and Spain in 2018, and it will debut in Poland and Germany this year. Now the discounter chain is testing Lidl Pay: this solution combines loyalty functions with QR code-based mobile payment.

As for Apple Pay, Hungarian consumers can add their Mastercard or Visa payment cards to Apple Pay already at six financial service providers. FinTechZone’s estimation is that from the approximately 1 million Hungarian iPhone users nearly 200,000 will do so until the end of the year if CIB Bank and K&H Bank also introduce the service in the months to come. //