ASX shares can provide exposure for investors to the big shift to contactless payments.
Mastercard recently did a survey which showed that consumers are making a shift to contactless payments for regular purchases as people look for safer ways to pay for things.
According to Mastercard, around 80% of people now use contactless payments. In the Asia Pacific region, tap and go transactions in the region grew 2.5 times faster than non-contactless transactions in grocery and drug store categories between February and March.
Perhaps of most interest, Mastercard revealed that 75% of us said that we'll continue to use contactless payments after the coronavirus pandemic is over. That doesn't mean cash is totally dead yet. There are certain groups of society that will probably prefer to keep using cash like the elderly.
ASX shares that could benefit from the shift to contactless payments
Afterpay Ltd (ASX: APT)
The buy now, pay later (BNPL) ASX share is revolutionising how we pay for products. Obviously the instalments method is the main difference. But the Afterpay system provides a contactless way to pay for products too.
Afterpay continues to generate excellent growth year after year. The Afterpay share price is up another 5% today and it has grown by 108% over the past year. It's one to watch but I really don't know if it's good value to buy today.
Pushpay Holdings Ltd (ASX: PPH)
Pushpay is an electronic donation business. The ASX share enables people to digitally donate, so they don't have to be there in person to give their cash. That's helpful in today's climate.
At the moment Pushpay's focus is on US churches. Americans are very generous with their tithing. There is a large market for Pushpay to target. Management think the revenue opportunity there for the longer-term amounts to $1 billion.
Pushpay can grow into other donation sectors too. US churches aren't the only opportunities out there. I'm excited by how much Pushpay can grow its profit margins over the next few years.
MFF Capital Investments Ltd (ASX: MFF)
A listed investment company (LIC) wouldn't strike you as one of the best ways to get exposure to the growth of contactless payments. But I think the ASX share could be a very good way to get that exposure.
Why would MFF Capital be so good? At the end of May 2020, Visa made up 18.5% of MFF's portfolio and Mastercard made up 16.2% of the portfolio. That means more than a third of the LIC is exposed to contactless payment businesses. I believe Chris Mackay will continue to lead MFF Capital to strong long-term returns.
Foolish takeaway
I think each of these ASX shares have exciting growth potential thanks to their link with contactless payments. At the current share prices I'd be happy to buy shares of Pushpay and MFF Capital.
