Scope of the use of digital wallets reached a peak of NIS 3.2 billion in May


by Ifi Reporter Category:Financial Jun 19, 2023

The scope of the use of digital wallets and smart watches reached a peak of NIS 3.2 billion in May: 2.7 times compared to its scope in May 2022, according to SBA data, which develops and manages the national credit card payment system in Israel.
Two years ago, in May 2021, Apple Pay entered Israel and was the first international company operating in the field. In the months before that, a number of local digital wallets were operating, but the scope of use was only tens of millions, and when Apple Pay was introduced, the scope of use was only 150 million shekels.

Although the introduction of digital wallets did not immediately change the payment habits of Israelis, and most of them still prefer to use a physical credit card, the rate of use of digital wallets in relation to the total number of physical transactions (carried out in businesses) continues to rise steadily and reached a peak of 19.1% in May, which is one in five transactions. This is compared to 15.6% last January and only 7.5% in May last year.
  According to estimates, the vast majority is carried out in the wallets of Apple and Google - the two main players in the market. Google entered at the end of 2021, about six months after Apple's entry, and was another significant factor in the assimilation of digital wallets.
It also appears from IBA data that the rate of smart credit transactions - meaning transactions made using the EMV system and including, in addition to digital wallets, also contactless credit transactions - remains stable at 92.5% of total credit transactions - similar to its rate in recent months.
Today, gas stations as well as government services are still excluded from implementing the EMV system, which prevents its full implementation, but by 2024 the obligation to implement the system - which allows contactless payment and is considered safer - will apply to the entire economy. The total credit transactions in the EMV system amounted to NIS 37.9 billion out of total expenses of NIS 40.1 billion. That is, the total number of transactions made in the old credit system (based on magnetic stripe) was only about NIS 2 billion.



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