15/05/2017 – News / Juniper Research / Contactless Transactions
Value of contactless transactions to reach $1.3tn by 2019
New data from leading fintech analyst Juniper Research forecasts that the global value of contactless transactions made via payment cards, mobile and wearables will reach US$1.3 trillion by 2019, more than doubling from an estimated $590 billion in 2017.
According to the new research – ‘Contactless Payments: NFC Handsets, Wearables & Payment Cards 2017-2021’ – contactless card levels will continue to dominate transaction values, accounting for 80 per cent of total contactless transactions in 2019. The research forecasts that contactless transactions via debit/credit cards will exceed US$2 trillion globally by 2021.
Mobile contactless – competing with cards
The research found that many markets with a relatively well-established contactless infrastructure have been seeded by the card providers – albeit with varying degrees of success.
Juniper found that in 2016, while cards accounted for well over 90 per cent of transactions by value in many European markets (for example, rising to 99 per cent in Spain), in the US the position was reversed, with mobile wallets accounting for 90 per cent of the total contactless transactions in the States.
“Purely from a payments and convenience perspective, it will be difficult for mobile wallet providers to gain existing market share from contactless cards. It is therefore incumbent upon them to deliver innovative services through which the mobile wallet will become the default payment mechanism,” advised research author Nitin Bhas.
Beyond retail payments: a potential boon for charities
The research found that, given the digital adoption in markets such as the UK, there is a significant opportunity for the charity sector to utilise contactless payments and digitise transactions. For example, in the UK and Ireland, Visa is working with organisations to trial charity donation boxes fitted with contactless readers, with contactless donors observed to pay three times more than the average cash donor. Juniper predicts that charity boxes, along with other similar initiatives, will continue to grow at an incredible pace alongside the mobile contactless payment segment.
The whitepaper ‘Is OEM-Pay the Future of Contactless?’ can be downloaded free from Juniper’s website: www.juniperresearch.com