Tag: NFC payments

Gartner has just released research that suggests that the adoption of the technology has held back growth in other areas.

Though money transfers have been booming over mobile, Gartner has just published the results of its latest research which have indicated that the adoption of NFC technology has been adequately poor that it is actually holding back the growth of smartphone based payments around the globe.

They have, however, predicted that mobile money transfers will continue their growth at least through 2017.

Though technology and banking giants had had very high hopes for tap-and-pay and contactless payments over smartphones, when all is said and done, NFC technology has proven to be nothing more than a disappointment over the last while and, according to the report, has hindered the growth of the overall mobile payments market worldwide. At the same time, the report also indicates that there are still some bright spots and there is still some potential for future use by consumers.

The Gartner report said that NFC technology tremendously held back the value of transactions over smartphones.

Gartner explained that due to NFC technology, the value of transactions completed via smartphone “has been reduced by more than 40 percent throughout the forecast period due to disappointing adoption of NFC technology in all markets in 2012 and the fact that some high-profile services, such as Google Wallet and Isis, are struggling to gain traction.”

The forecasts that Gartner is now making state that NFC technology will now make up only 2 percent of the total transaction value for mobile payments this year and that by 2017, it will represent only 5 percent of the total. It does see that there is the potential for faster growth in 2016 when there is greater penetration of enabled smartphones and contactless readers.

What does seem evident to the company’s analysts as well as to other observers in the industry is that the greatly hyped NFC technology will not be revolutionizing mobile payments as had once been the general belief. It has been facing far too many struggles on a great number of levels both from the side of the devices and the payment terminals to take off at any time in the very near future.

The contactless tech took a big hit when the global retail giant declared it not to be worthwhile.

Tesco, a supermarket giant, has been making some heads spin with its latest announcement that it feels that NFC technology doesn’t have any real value, when speaking at a recent conference.

Many in the industry felt that near field communication is the next up and coming thing.

That said, they may be thinking twice about NFC technology now that the Tesco, a company based in the United Kingdom, gave such a poor assessment of it. The mobile payments industry had been under the impression that this could be the technology that would be used in order to accelerate the drive toward a cashless society.

NFC technology allows information – such as payment transactions – to be exchanged between two devices.

It works by holding the two devices close to one another, or tapping them together. The use of NFC technology also includes a security chip to make sure that data remains encrypted and cannot be read by the wrong recipient. It has been promising to become the best way to offer a range of different mobile wallet services, such as for payments, ticketing, and other similar purposes.

Many industry giants have been banking on NFC technology, including Google Wallet and Isis. However, Tesco says that this isn’t quite what it has been chocked up to be. In fact, it was suggested that it has actually come and gone, and that it won’t be progressing beyond what it has already achieved.

The company has no plans to implement the near field communications and feels that any attempt to try to use NFC technology would simply complicate things. They cannot see that it will take off in any realistic way.

In its statement at the conference, it drew attention to the fact that contactless credit cards already exist, so using mobile NFC technology based payments would not be adding any level of value. Moreover, it suggested that it would not provide any beneficial consumer experience and would simply add complexity to the checkout process. This is in direct opposition to much of the mobile payments industry that is continuing to drive forward with this tech.