(Source: Inside Retail Philippines | 17 May 2017)
New data from fintech analyst Juniper Research forecasts that the global value of contactless payments made via cards, mobile and wearables, will reach US$1.3 trillion by 2019, more than doubling from an estimated $590 billion in 2017.
Contactless card levels will continue to dominate transaction values, accounting for 80 percent of total contactless transactions in 2019. The research forecasts that contactless transactions via debit/credit cards will exceed $2 trillion globally by 2021.
In many markets around the world, a relatively well-established contactless infrastructure has been seeded by card providers, albeit with varying degrees of success.
Juniper found that in 2016, while cards accounted for well over 90 percent of transactions by value in many European markets (rising to 99 percent in Spain, for example), in the US the position was reversed, with mobile wallets accounting for 90 percent of contactless transactions there.
“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,” wrote research author Nitin Bhas.
The research found that, given the digital adoption in markets such as the UK, there is a significant opportunity for the charity sector to use contactless payments and digitize transactions. For example, In the UK and Ireland, Visa is working with organizations 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 a fast pace alongside the mobile contactless payment segment.