Contactless Payments Market Is Estimated To Witness High Growth
The Contactless Payments Market is estimated to be valued at US$ 15782.66 Mn in 2023 and is expected to exhibit a CAGR of 13.% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Contactless payments enable consumers to purchase goods and services by waving a contactless payment card or payment-enabled device over a contactless-enabled payment terminal without inserting a plastic card into the payment terminal. Contactless payments offer advantages such as faster transaction times, increased security against fraud, and convenience to consumers. The rising adoption of contactless cards, mobile wallets, and contactless point-of-sale (POS) terminals is expected to drive the growth of the contactless payments market.
Market key trends:
The contactless payments market is expected to witness high growth owing to the rapid adoption of contactless payments among consumers, especially millennials and Generation Z. The ease of use and quick transaction time offered by contactless payments as compared to conventional cash and card-based payments are fueling their adoption. Moreover, the ongoing digital transformation in the retail sector and growing deployment of contactless POS terminals by retailers and merchants are also boosting the market growth. Manufacturers are focusing on developing advanced contactless payment solutions such as near-field communication (NFC)-enabled payments, which can be accepted at millions of storefronts worldwide. The increasing focus on enhancing the consumer payment experience through innovative contactless solutions is expected to open new avenues for the market over the forecast period.
Porter's Analysis
Threat of new entrants: Low capital requirements and lack of proprietary technology make it easy for new players to enter the market. However, established players dominate distribution channels which pose barrier for new entrants.
Bargaining power of buyers: Buyers have high bargaining power due to availability of substitutes and undifferentiated products from competitors. Buyers can easily switch to alternative payment methods.
Bargaining power of suppliers: Payment technology providers and manufacturers have moderate bargaining power due to lack of alternative suppliers and customized solutions development.
Threat of new substitutes: Mobile wallets and cash/cards pose threat of substitution with lower costs and convenience.
Competitive rivalry: Intense competition due to presence of established players differentiating through technology and customer experience.
SWOT Analysis
Strengths: Contactless technology provides fast and secure payment experience. Growing usage of smartphones has accelerated adoption of contactless payments.
Weaknesses: Security and privacy concerns continue to challenge growth. Infrastructure gaps in developing nations hamper large scale deployment.
Opportunities: Integrating with loyalty and offers can boost usage. Partnerships with merchants across industries drive transactions volume.
Threats: Disruption due to evolving digital technologies like digital wallets and biometrics. Stringent regulations on data usage restrain monetization.
Key Takeaways
The Global Contactless Payments Market Growth is expected to witness high, exhibiting CAGR of 13.% over the forecast period, due to increasing digitization and growing e-commerce sales driving cashless transactions. Mobile proximity payments are gaining traction, supported by rising smartphone penetration worldwide.
Regionally, Asia Pacific dominates currently due to large untapped opportunities and government initiatives to promote digital payments in countries like India and China. Europe follows owing to widespread acceptance of contactless cards and mobile wallets in countries including UK, France and Germany.
Key players operating in the contactless payments market are Thales Group, Infineon Technologies AG, Ingenico Group, Wirecard, VeriFone, Inc., Giesecke+Devrient GmbH, IDEMIA, Track Innovations LTD., Identiv, Inc., CPI Card Group Inc., Setomatic Systems, Valitor, PAX, PINPAD, Mobeewave, alcineo, and Paycor, Inc. Major players are focused on partnerships, acquisitions and technology innovations to consolidate market presence.