The global market for contactless payment transaction features a highly competitive vendor landscape and the presence of a large number of small and large service providers, observes Transparency Market Research. Competitive rivalry has further intensified in the market due to the entry of a number of banks, telecom companies, card companies, and payment companies of late. The low entry barriers in the market are expected to continue to allow new players in, further making the market fragmented and immensely competitive in terms of service costs.
To ensure sustainable returns, innovation and effective marketing strategies will be the most practical approaches. Solutions with innovative technologies such as Samsung’s patented magnetic secure transmission (MST), which emits a magnetic signal mimicking the magnetic strip on conventional payment cards, are expected to allow companies the much needed push in the competitive market. Some of the leading players in the market are Apple Inc., Barclays, Gemalto N.V., Giesecke & Devrient GmbH, Heartland Payment Systems, Inc., and Ingenico Group.
Contactless Cards to Remain Most Used Contactless Payment Transaction Mode of Payment
In terms of mode of payment, including technologies such as contactless cards, wearable devices, and contactless mobile payments, the segment of contactless cards held the dominant share in the global market in terms of both revenue and volume in 2016. The segment is expected to remain at the forefront in terms of the rate of adoption across the globe over the forecast period as well, exhibiting a massive 94.3% CAGR in terms of revenue contribution to the global contactless payment transaction market.
From a geographical standpoint, the global contactless payment transaction market is expected to be dominated by the market in Europe over the forecast period. In 2016, the Europe market accounted for a massive 59.4% share of the total number of contactless payment transactions undertaken across the globe. Over the report’s forecast period as well, the Europe market for contactless payment transactions is expected to register strong growth, and driven chiefly due to the rising adoption of NFC-based smart wearable devices and consumer electronic products and the increased use of contactless cards.
Rising Usage of Mobile Phones to Continue Boosting Adoption
Some of the key factors expected to have a significant positive implication on the way the market for contactless payment transaction will evolve in the next few years are the rising demand for fast and convenient ways of completing transactions, especially in the transport and retail sectors and the rising usage of smartphone for payments. Businesses have started steadily understanding the direct benefits of implementing contactless payment transactions in the form of an enhanced counter sales processes and a vast rise in the number of transactions possible throughout a day. This has encouraged companies across a number of industries such as hospitality, media and entertainment, and healthcare to adopt the contactless payment transaction infrastructure.
The vast rise in the numbers of smartphone or basic mobile phone users has also boosted the expansion of contactless payments. The ease of carrying out payment transactions without having to carry credit/debit cards and cash is encouraging consumers as well as merchants to adopt contactless payment transactions as one of the primary payment mechanisms. Technological advanced features in mobile phones such as mobile wallets, which eliminate the need for NFC-enabled PoS (point of sale) machines to complete transactions, have also boosted the level of acceptance off contactless payment transactions.
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