GVR Report cover Contactless Payment Market Size, Share & Trends Report

Contactless Payment Market Size, Share & Trends Analysis Report By Device, By Solution (Payment Terminal Solution, Security & Fraud Management), By Application, By Region, And Segment Forecasts, 2021 - 2028

  • Published Date: Feb, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-2-68038-217-4
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2019
  • Number of Pages: 120

Report Overview

The global contactless payment market size was valued at USD 1.34 trillion in 2020. It is expected to expand at a compound annual growth rate (CAGR) of 20.3% from 2021 to 2028. The growth can be attributed to the increasing adoption of digital payment platforms across the globe. Nowadays, customers are focusing on making seamless payments for many of their daily transactions. Moreover, increasing expectations for secure and integrated ways to pay for any service or product is expected to drive market growth. The growing convenience of the low-value payment offered by contactless payment solutions is anticipated to propel the market growth. Cardholders are encouraged to use these solutions by advertising campaigns that highlight the convenience and speed of contactless payment. These solutions are widely deployed by merchant outlets that sell low‑value products such as snacks and drinks. Moreover, card issuers are increasingly adding contactless functionality to their payment cards.

U.S. contactless payment market size, by device, 2016 - 2028 (USD Billion)

The continuous innovation in products and services and development in payment security technologies is strengthening the market growth. Moreover, contactless payments enable money transactions to be carried out in between a point-of-sale terminal and a consumer’s payment device. The paradigm shift in payment awareness and preferences among customers is expected to fuel the market growth over the forecast period. Furthermore, growing contactless technologies in numerous applications, such as ticketing, toll booths, fuel stations, and vending machines, are expected to boost the market growth.

Increasing demand from merchants and consumers to reduce billing and transaction time will propel the market growth. The safety and security of money transactions is the primary concern of merchants and consumers. Various factors, such as rising government initiatives and ongoing advancements in networking infrastructure for the development of smart solutions, are expected to fuel the market growth. Several government administrations across the globe are encouraging their merchants to implement advanced payment solutions.

The outbreak of COVID-19 is expected to have a positive impact on the market. The COVID-19 pandemic has significantly impacted the market owing to the increase in adoption and use of digitalized and online payment methods across the globe. Furthermore, to curb the spread of the virus, numerous governments have imposed lockdown, which has resulted in lowered usage of cash. However, the rise of cyber-attack and lack of infrastructure in developing economies are expected to hamper the market growth.

Device Insights

The smartphones and wearables segment led the market and accounted for more than 59.0% share of the global revenue in 2020. An increase in the adoption of smartphones and wearable devices among the youngsters of various countries is expected to create growth opportunities for the segment growth. The usage of smartphones and wearables has drastically increased in everyday activities. Also, innovations in wearables, such as payment rings and payment bands, are anticipated to fuel the segment growth over the forecast period.

The smart cards segment is anticipated to register the highest CAGR over the forecast period. Increasing demand for smart cards across numerous industries coupled with growing penetration of blockchain technology amongst several smartcard providers to improve the security of the cards is expected to drive the segment growth. Acceptance of smart cards is becoming more common across the globe. Merchant outlets are focusing on reducing consumer queues by allowing consumers to use smart cards for speedier transactions.

Solution Insights

The payment terminal solution segment dominated the market and accounted for more than a 43.0% share of the global revenue in 2020. The segment growth can be attributed to the increasing implementation of Point-of-Sale (POS) terminals in the banking, hospitality, and retail industry. Furthermore, the integration of the internet of things (IoT) with an existing payment terminal solution is expected to offer lucrative opportunities over the forecast period. These aforementioned factors are expected to drive the segment growth over the forecast period.

The security and fraud management segment is anticipated to register the fastest CAGR over the forecast period. Contactless payment transactions are susceptible to fraud, owing to which users have become more aware of using these systems. Numerous technology providers are continuously upgrading their security protocols to improve the security management of the transaction processes. These aforementioned factors are expected to drive the segment growth over the forecast period.

Application Insights

The retail segment led the market and accounted for more than 61.0% share of the global revenue in 2020. Retailers are adopting innovative technologies, such as big data analytics, cloud computing, social networks, and digital stores to increase their presence and visibility in the market. Moreover, retailers are also understanding the benefits of contactless payments, which include increased revenue, reduced transaction time, minimized operating costs, and improved operational efficiency. Furthermore, mobile payments have helped retailers to reduce counter queues and accelerate the transaction process.

Europe contactless payment market share, by application, 2020 (%)

The hospitality segment is anticipated to register the fastest CAGR over the forecast period. Contactless payment is becoming increasingly popular throughout the hospitality industry. The hospitality businesses have started embracing some of the most cutting-edge technology while offering their guests a more user-friendly experience. These businesses are increasingly adopting contactless payment solutions owing to various benefits it offers, such as fast & secure transactions and a high level of customer satisfaction.

Regional Insights

Europe dominated the contactless payment market and accounted for more than a 33.0% share of the global revenue in 2020. The regional market growth can be attributed to the consistently increasing electronic money transactions in the region. The payment solutions enabled by real-time & biometric, along with a secured performance of smart card transactions, are anticipated to drive demand for contactless payment in the region. Furthermore, favorable government regulations, such as open banking and second payment services directive, are also contributing to the regional market growth.

North America is expected to emerge as the fastest-growing regional market over the forecast period. The well-established IT industry in North America supports the development of technology. Also, IT companies in the region are leveraging their attempts to support the adoption of a contactless payment platform. Moreover, the companies are collaborating with numerous financial institutions to develop secure, transparent, decentralized, and robust platforms owing to the increasing challenges of cyber-crimes.

Key Companies & Market Share Insights

The market players are focusing on business strategies, such as new product launches, to increase their customer base and strengthen their product portfolio. For instance, in January 2020, Mastercard certified the first-ever contactless fingerprint payment card by Thales Group. Moreover, this new certification is expected to drive product adoption in technologically advanced countries. Also, the project is presently deploying numerous pilot projects.

Several players are focusing on adopting various types of technology to improve their payment platform performance. Vendors are incorporating blockchain technology to increase security and speed for retail payment applications. Vendors are also focusing on business strategies, such as partnerships. For instance, in January 2020, Visa Inc. partnered with Samsung to innovate the tap to phone program. This program enables micro-seller to receive payments with the help of Android smartphones without any extra hardware. Some prominent players operating in the global contactless payment market include:

  • Gemalto N.V.

  • Visa Inc.

  • Giesecke & Devrient GmbH

  • Heartland Payment Systems

  • Verifone Systems Inc.

  • Ingenico Group SA

  • On Track Innovations (OTI) Ltd

  • IDEMIA

  • Thales Group

  • Wirecard AG

Contactless Payment Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 1.71 trillion

Revenue forecast in 2028

USD 6.25 trillion

Growth Rate

CAGR of 20.3% from 2021 to 2028

Base year of estimation

2020

Historical data

2016 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD billion and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company market share, competitive landscape, growth factors, and trends

Segments covered

Device, solution, application, region

Regional scope

North America; Europe; Asia Pacific; South America; MEA

Country scope

U.S.; Canada; Mexico; Germany; U.K.; France; Italy; Spain; China; India; Japan; Australia; South Korea; Singapore; Taiwan; Brazil

Key companies profiled

Gemalto N.V.; Visa Inc.; Giesecke & Devrient GmbH; Heartland Payment Systems; Verifone Systems Inc.; Ingenico Group SA; On Track Innovations (OTI) Ltd; IDEMIA; Thales Group; Wirecard AG

Customization scope

Free report customization (equivalent to up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope

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Segments Covered in the Report

The report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2028. For the purpose of this study, Grand View Research has segmented the global contactless payment market report based on device, solution, application, and region:

  • Device Outlook (Transaction value, USD Billion, 2016 - 2028)

    • Smartphones and Wearables

    • Point-of-Sales Terminals

    • Smart Cards

  • Solution Outlook (Transaction value, USD Billion, 2016 - 2028)

    • Payment Terminal Solution

    • Transaction Management

    • Security and Fraud Management

    • Hosted Point-of-Sales

    • Analytics

  • Application Outlook (Transaction value, USD Billion, 2016 - 2028)

    • Retail

    • Transportation

    • Healthcare

    • Hospitality

    • Government

  • Regional Outlook (Transaction value, USD Billion, 2016 - 2028)

    • North America

      • U.S.

      • Canada

      • Mexico

    • Europe

      • Germany

      • U.K.

      • France

      • Italy

      • Spain

    • Asia Pacific

      • China

      • India

      • Japan

      • Australia

      • South Korea

      • Singapore

      • Taiwan

    • Latin America

      • Brazil

    • Middle East & Africa

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