Transaction Volume Is On the Road to Recovery After Getting Hammered by Covid, Says Shift4

Just over a year after transaction volume in many merchant segments flatlined due to the economic turmoil caused by the Covid-19 pandemic, activity is showing a steadily strengthening pulse, according to data released Thursday by Shift4 Payments Inc.

In March, Shift4’s end-to-end transaction volume totaled $3.3 billion, up 40% from February and 82% from March 2019, when many capacity restrictions began to be imposed on merchants. Restaurants and hotels, which were particularly hard hit by the economic repercussions of the pandemic, have seen transaction volumes increase more than 200% since last April, despite a dip in November and December as the number of Covid-19 cases spiked. 

Factors spurring the recovery among restaurants include online ordering, contactless payment, QR code acceptance, outdoor dining, and, in some locales, a loosening of capacity restrictions for indoor dining.

“These factors, coupled with pent-up demand from consumers, have led to a faster recovery than many would have anticipated,” Taylor Lauber, chief strategy officer at Shift4, says by email. “Shift4 is in the unique position of both benefiting from this recovery and also having added a substantial number of new merchants by helping them enable these technologies.” 

Spring-break travel is also helping to spur the recovery. Five of the top 10 cities for transaction volume in March were in Florida, according to Shift4. Las Vegas is another destination city enjoying a surge, as volume among local merchants propelled the city into the Top 10 for the first time since the pandemic hit. While hotels are enjoying the fastest recovery rates, volume remains 20% below pre-pandemic levels.

“If you look at broad averages across the country, restaurants were down 15%-20% and hotels 20%-30%, and merchants overly reliant on business spending and travel were impacted significantly more,” Lauber says “Bright spots were definitely the warmer states.”

Looking ahead, merchants can expect to see increasing volumes throughout the year, Lauber says.

“While we’re always cautious of the more lasting effects from the pandemic, merchants in virtually every category and geography are far better now than at any point over the past year,” Lauber says. “It remains tough to predict when businesses [will] experience normal [activity] and when large venues such as stadiums will be back at capacity, but the likelihood of a return to more restrictions is quite low.”