Tag: contactless payments

New report shows the number of users to use this form of mobile payments will almost triple by 2017.

A recent Juniper Research study indicates that there could be as many as 300 million consumers worldwide who will make mobile contactless payments by the year 2017, which is a huge increase from the slightly more than 110 million that utilized this mobile payment service in 2013.

Contactless card rollouts are gaining momentum in many countries across the globe.

According to the study, several markets may soon be adopting contactless payments for mobile due to the success and popularity of contactless debit and credit cards. In addition, the introduction of contactless cards also lead to an increase in Point of Sale (POS) terminals equipped with Near Field Communications (NFC). It has now become standard for leading POS vendors like Ingenico and VeriFone to ship most of their terminals with NFC.

However, the research director and author of the report, Windsor Holden, stated that stakeholders need to work on their efforts to increase awareness among consumers regarding mobile contactless payments. Furthermore, he said the value proposition also needs to be taught to retailers. Holden commented that contactless payment technology is mainly “being sold to retailers on the basis of faster throughput at the POS. The other critical opportunities offered by contactless – such as consumer engagement and product upselling – are much lower on their radar.”

The cost of mobile contactless payments cards is higher than plastic cards.

The Juniper study also noted that NFC rollouts have been held back due to the lack of a clear business model. Currently, it costs more to issue a mobile payment card than it does a plastic card.

In addition, it is likely that the mobile contactless payments market will receive a significant boost from the expected launch of Apple’s iWallet service. That being said, currently, it is not clear if extra POS upgrades will be necessary once the service is launched. Moreover, it has not been officially confirmed that Apple will be releasing a mobile payments service or that it will feature NFC technology. This isn’t the first time NFC rumors have been linked to Apple, but nothing has ever come of these rumors.

By the year 2018, there is going to be a considerable rise in the capabilities for these payments apps.

According to a new forecast that has now been published, by the year 2018, one fifth of all smartphones will have mobile wallet functionality, and one third of all of those payments apps will involve contactless capabilities such as NFC technology.

This report has indicated that there will be a considerable growth in the potential for these apps.

The study and report were created by Juniper Research. That firm determined that there will be two separate mobile wallet models that will define themselves between now and the close of 2018. Within the emerging markets, it will be the Store Value Accounts (SVAs) that will continue to take off. Those forms of app are catering to the massive number of unbanked individuals in Latin America, developing Asia, and sub-Saharan Africa by providing them with financial access for the first time.

In the Western world, the mobile wallet model that will become common will be different.

That model will likely be based on contactless technology such as near field communication (NFC). These launches are expected to occur throughout North America and Western Europe. That latter form appears to be facing the greatest level of challenge when compared to emerging markets, where these apps are taking off more quickly. For instance, Alipay, in China, has already managed to register 100 million users.

The so-called iWallet, Apple’s contribution to this market space, is expected to arrive at any time. This could be a defining addition to mobile payments as it could either represent the point from which these smartphone wallets start to take off in the West, or it could reveal that these apps really will be facing some massive struggles in being able to take off.

It is believed that the iWallet will be based on HCE (Host Card Emulation) NFC services. The use of HCE could prove to be a considerable threat to the role of mobile operators in the contactless payments market. It likely won’t be very long before a much better understanding of the direction of the mobile wallet will be formed.