US customers have entrenched habits around physical cards, even as they embrace contactless. Physical contactless cards outpaced wallets to more than double their share of in-store payments in 2021, per an August 2021 PYMNTS survey.

Virtual cards’ ease of use and security benefits will make them the fastest-growing segment of B2B card payments by volume, per Juniper Research. As issuers look to capitalize on the interchange revenue opportunity, we’ll see more partnerships like Amex’s deal with Extend, which lets cardmembers create virtual cards for employees, contractors, and vendors.

The US has been relatively late in introducing contactless cards, which are credit or debit cards that include a near field communication (NFC) chip that can complete a transaction simply by tapping on a reader. But those cards are starting to arrive in the US now that most point-of-sale (POS) systems have the NFC capabilities to accept them.

During the coronavirus pandemic, many consumers have preferred to pay local businesses using traditional payment methods over contactless channels. According to May 2020 polling from Podium, the highest share of US internet users surveyed (42.9%) said they preferred using a credit card reader, with cash coming in second at 18.4%.

It launched the standalone Google Wallet, and a new Chrome feature lets online shoppers convert their cards to virtual cards.

Since credit card users are more likely than debit users to favor mobile contactless, per Payments Canada, there is still momentum in the market: The tendency to choose contactless for credit outpaced debit even during the pandemic. High credit card usage ultimately creates revenue opportunity for wallet providers.

The pandemic accelerated payments industry digitization across the entire landscape, as merchants turned to ecommerce to keep doors open, consumers eschewed cash in favor of electronic and contactless payments, and payments technology providers rapidly developed and launched new solutions to keep up.