Contactless Payment Market Outlook
The global contactless payment market size was valued at USD 41.15 Billion in 2022 and is likely reach to USD 198.42 Billion by 2031, expanding at a CAGR of 19.1% during the forecast period, 2023–2031. The growth of the market is attributed to the increasing incorporation of contactless payment technology in smartphones and mobile headsets along with growing awareness of plastic money and smart cards among the buyers.
Contactless payment refers to a transaction procedure to make a secure payment from the electronic devices such as tablets, smartphones, computers, and other portable devices. This technique uses radio-frequency identification or biometrics for making secured payments.
Furthermore, contactless payment system enables users to make secure purchases without any further need of different cards or signatures.
Moreover, consumers can wave or tap their smart cards, key fobs, or portable gadgets over a reader at a point of sale (POS) terminal with inbuilt chip and antenna in transaction devices.
However, contactless payments have become increasingly popular in the post COVID-19 pandemic outbreak due to facilities such as less physical interaction and movement restriction. Payments using digital wallets or other smartphone-based payment interfaces have surfaced as possible options for preventing virus transmission.
Furthermore, in the midst of this pandemic, recent advancements in digital payments have pushed the adoption of contactless payments.
Market Trends, Drivers, Restraints, and Opportunities
- Increasing government initiatives and rising technological advancements in networking infrastructure are the major factors propelling the market growth.
- Ongoing awareness campaign conducted by governments to encourage merchants to adopt advanced payment solutions is expected to fuel the market expansion.
- Rising digitization in developing economies and growing number of internet users globally are boosting the market growth during the forecast period.
- Increasing financial frauds along with arising technical glitches while making online payment are key challenges hindering the market expansion.
- Rising strict rules & regulations imposed by banks towards the online payment is another major factor limiting the market growth.
- Introduction of innovative security features such as blockchain is anticipated to offer lucrative growth opportunities in the global contactless payments market in the coming years.
Scope of Contactless Payment Market Report
The report on the global contactless payment market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.
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Attributes
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Details
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Report Title
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Contactless Payment Market - Global Industry Analysis, Growth, Share, Size, Trends, and Forecast
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Base Year
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2022
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Historic Data
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2016–2021
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Forecast Period
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2023–2031
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Segmentation
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Applications (Transportation, Government, Retail, Healthcare, Hospitality, and Others), Devices (Smart Cards, Smartphones & Wearables, Point of Sales Terminals, and Others), and Payment Solutions (Analytics, Transaction Management, Payment Terminal Solution, Security & Fraud Management, and Hosted Point of Sales)
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Regional Scope
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Asia Pacific, North America, Latin America, Europe, and Middle East & Africa
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Report Coverage
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Company Share, Market Analysis and Size, Competitive Landscape, Growth Factors, and Trends, and Revenue Forecast
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Key Players Covered in the Report
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Heartland Payroll Solutions, Inc.; Gemalto N.V.; Wirecard AG; Giesecke & Devrient GmbH; Visa Inc.; Verifone Systems Inc.; On Track Innovations (OTI) Ltd.; Thales Group; Ingenico Group SA; and IDEMIA.
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Contactless Payment Market Segment Insights
Retail segment is expected to grow at a rapid pace
Based on applications, the global contactless payment market is segmented into transportation, government, retail, healthcare, hospitality, and others. The retail segment is expected to grow at a rapid pace during the forecast period owing to the growing adoption of innovative technology such as cloud computing, big data analytics, digital stores, and social networks.
Moreover, merchants are gradually adopting innovative techniques to extract maximum advantages of contactless payments such as increased revenue, shorter transaction times, lower operating expenses, and improved operational efficiency.
Furthermore, mobile payments have aided shops in reducing line lengths at checkout and speeding up the transaction process.
However, the hospitality segment is expected to expand at considerable rate in the coming years since hospitality companies have begun to adopt some of the most cutting-edge technology in order to provide a more user-friendly experience for its customers.
Smartphones & wearables segment is projected to expand at a considerable CAGR
On the basis of devices, the market is segregated as smart cards, smartphones & wearables, point-of-sales terminals, and others. The smartphones & wearables segment is projected to expand at a considerable CAGR during the forecast period due to the growing adoption of smartphones & wearable devices among the youngsters across countries.
Moreover, the usage of smartphones & wearables has drastically increased in routine activities. In addition, wearable innovations such as payment rings and bands are expected to fuel the segment growth in the coming years.
However, the smart cards segment is projected to register substantial CAGR during the forecast period due to the high demand for smart cards across several industries. Moreover, increasing penetration of blockchain technology amongst numerous smartcard providers to develop the security of the cards present another key driver for the segment growth.
Additionally, smart cards are becoming more broadly accepted all around the world. Merchants are concentrating on minimizing customer wait times by allowing them to utilize smart cards for faster transactions.
Payment terminal solution segment is estimated to gain a large revenue share
Based on payment solutions, the global contactless payment market is divided into analytics, transaction management, payment terminal solution, security & fraud management, and hosted point of sales.
The payment terminal solution segment is estimated to gain a large revenue share during the forecast period owing to the rapid implementation of point of sale (POS) terminals in the retail, hospitality, and banking industry.
Moreover, integrating Internet of Things (IoT) with an existing payment terminal solution is likely to present attractive potential. Thus, aforementioned factors are propelling the segment in the coming years.
However, the security & fraud management segment is anticipated to expand at a high CAGR during the forecast period attributed to the constantly improving security systems by key players in order to develop better transaction security management.
Contactless Payment Market Regional Outlook
Europe is anticipated to constitute a key market share
In terms of regions, the market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. Europe is anticipated to constitute a key market share during the forecast period owing to the rising electronic money transactions and developing advanced payment solutions enabled by real-time & biometric.
Moreover, favorable government regulations such as open banking and second payment services directive are propelling the market growth in the region. In addition, banks are incorporating with mobile payment apps in the region due to the increasing adoption of smartphones.
As per a recent survey conducted by Mastercard, contactless credit card payments accounted for over half of all transactions in more than a dozen European nations.
However, the market of North America is estimated to expand at a high growth rate during the forecast period due to the well-established IT industry supporting the development of technology in the region.
Additionally, in response to the growing threat of cyber-crime, companies are partnering with a number of financial institutions to establish safe, transparent, decentralized, and robust platforms for cashless payments. These factors are projected to boost the regional market growth in the coming years.
Segments
Applications
- Transportation
- Government
- Retail
- Healthcare
- Hospitality
- Others
Devices
- Smart Cards
- Smartphones & Wearables
- Point of Sales Terminals
- Others
Payment Solutions
- Analytics
- Transaction Management
- Payment Terminal Solution
- Security & Fraud Management
- Hosted Point of Sales
Regions
- Asia Pacific
- North America
- Latin America
- Europe
- Middle East & Africa
Key Players
- Heartland Payroll Solutions, Inc.
- Gemalto N.V.
- Wirecard AG
- Giesecke & Devrient GmbH
- Visa Inc.
- Verifone Systems Inc.
- On Track Innovations (OTI) Ltd.
- Thales Group
- Ingenico Group SA
- IDEMIA
Competitive Landscape
Some of the major players competing in the global contactless payment market are Heartland Payroll Solutions, Inc.; Gemalto N.V.; Wirecard AG; Giesecke & Devrient GmbH; Visa Inc.; Verifone Systems Inc.; On Track Innovations (OTI) Ltd.; Thales Group; Ingenico Group SA; and IDEMIA.
These major players are concentrating on implementing various types of technology such as block-chain and other business strategies including partnership, merger & acquisition, and collaboration in order to gain a large revenue share in the market.
For example, Visa Inc. has teamed up with Samsung in January 2020 to develop a tap to phone service. This program was aimed to help micro-sellers to accept payments using android smartphones without any additional hardware.
In another event, Titan Company Ltd. has entered a partnership with the State Bank of India (SBI) to launch Titan Pay powered by YONO SBI in September 2020.
Moreover, in 2020, CPI Card Group Inc., a payment technology firm and market leader of prepaid solutions for both debit and credit, launched its dual interface metal card solution, covering two vital developments in consumer payments in a unique way.
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