The opportunities for market growth in contactless payment have shown great promise around the world with tremendous growth potential in terms of revenue generation. Since last few decades, numerous countries have jettisoned cash and pivoted towards digital payments as the conventional payment method. Technological advancements, data security enhancements, and consumer preference for convenience have all underpinned the secular trend of cash displacement and adoption of digital payments. In recent years, we have seen rapid global adoption of a superior form of digital payments such as contactless payments. The growing trend of smart card, NFC Chips, mobile wallets is a key factor propelling the growth of contactless payment market.
Contactless payments provide consumers with a way to pay for goods and services without inserting or swiping a card directly into a point-of-sale (POS) terminal, often via payment cards (credit or debit) or smartphone devices. Conducted using Near Field Communication (NFC) technology, contactless payments exchange encrypted data from your payment card or smartphone to a payment terminal or tag within close proximity. With the COVID-19 pandemic serving as a tailwind, we’ve seen an acceleration in the secular trends of e-commerce and contactless payments usage as consumers adopt social distancing measures to avoid contracting or spreading the virus. Hygienic concerns linked to the pandemic have triggered a pull forward in cash displacement and present a unique opportunity for contactless payments to penetrate small ticket payments. Contactless payments represent a powerful tool for the financial technology industry to digitize low-value, high-frequency cash payments and drive card volume growth, while also delivering a compelling value proposition for users and merchants.
In order to counter the increasing fraud risk andliability mounting from unauthorized transactions, the industry transitioned to a new technology, the EMV (EuroPay, Visa, and Mastercard) chip, which holds an embedded microchip for encrypted data transfer when dipped into an EMV-enabled POS terminal. To promote the use of EMV payment cards, card issuers mandated an EMV liability shift in October 2015, which resulted in the transfer of responsibility for fraudulent losses from the card issuers to merchants in cases when the fraud occurred on an incorrectly processed chip card. Furthermore, contactless converts more small value payments from cash-to-card and drives engagement. According to Visa, close to 60% of global face-to-face transactions are tap to pay.
The global market for contactless payment is made up of a large number of influential players. Market players such as America Express Co, Gemalto N.V., Giesecke & Devrient GmbH, Heartland Payment Systems, and Ingenico Group dominate the worldwide Contactless Payment market. Some of the few other players include Inside Secure, MasterCard, Microsoft, Oberthur Technologies Sa, On Track innovations, Opus Software Solutions and Paypal Inc. Different businesses concentrate on organic tactics such as launches of products, product licenses, trademarks and activities Acquisitions and cooperation & partnerships became inorganic growth plan practices observed in the sector. Such operations have opened the way for industry leaders to grow their company and customer base. In the future, with the growing need for digital payments in the global economy, market players from the contactless payment market are anticipated to have lucrative growth prospects. With the demand for end-user experience tracking in the global markets, industry payers from end-user experience surveillance are expected to achieve lucrative growth prospects in the future.
Segment Overview of Global Contactless Payment Market
Type Overview, 2015-2028 (USD Billion)
- Smart Cards
- NFC Chips
- Point of Sale Terminals
- Mobile Handsets
- Other Devices
Application Overview, 2015-2028 (USD Billion)
- Managed Services
- Professional Services
- Multi-Channel Payment
Regional Overview, 2018-2028 (USD Billion)
- North America
- Rest of Europe
- Asia Pacific
- Rest of Asia-Pacific
- Middle East and Africa
- South Africa
- Rest of Middle East and Africa
- South America
- Rest of South America