Contactless Payments and Merchant Resiliency: Evidence from France in the Time of COVID-19

46 Pages Posted: 6 May 2021

See all articles by Youssouf Camara

Youssouf Camara

Télécom Paris; Ecole Polytechnique, Palaiseau

Date Written: May 5, 2021

Abstract

During the COVID-19 pandemic, consumers were encouraged to use contactless payments. %To support this approach, the French banking authorities increased the limit for contactless payment from 30 euros to 50 euros. An important policy question is whether merchants with contactless payment technology are more resilient to an external health shock than those without. Using a matched difference-in-differences setting on a unique merchant card-sales transaction data, I find that merchants with contactless payment technology increase their card-sales amount (count) on average by 8.3 percent (10.2 percent) compared to merchants without this technology. I also find evidence that accepting contactless payment during an epidemic shock helps merchants attract more new consumers. Digital payment technology continues to support sales growth, especially for small businesses and new entrepreneurs.

Keywords: Digital payment, COVID-19, Business resilience, Sales growth, Firm-level data

JEL Classification: C21, E21, E42, E61, E62, O33

Suggested Citation

Camara, Youssouf, Contactless Payments and Merchant Resiliency: Evidence from France in the Time of COVID-19 (May 5, 2021). Available at SSRN: https://ssrn.com/abstract=3840404

Youssouf Camara (Contact Author)

Télécom Paris ( email )

19 Place Marguerite Perey
Palaiseau, 91120
France

Ecole Polytechnique, Palaiseau ( email )

Route de Saclay
Palaiseau, 91128
France

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