Contactless Payment Terminals Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

The Contactless Payment Terminals Market is segmented by Technology(Bluetooth, Infrared, Carrier-based, Wi-Fi), Payment Method (Account-based, Credit/Debit Card, Stored Value, Smart Card), Device (Integrated POS, mPOS, PDA, Unattended Terminal, Contactless Reader), End-user Industry (Retail, Transportation, Banking, Government, Healthcare), and Geography.

Market Snapshot

Contactless Payment Terminals Market Overview
Study Period: 2018 - 2026
Base Year: 2020
Fastest Growing Market: Asia Pacific
Largest Market: Europe
CAGR: 25.86 %

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Market Overview

The global contactless payment terminals market was valued at USD 13.23 billion in 2020 and is expected to reach USD 51.07 billion by 2026 and grow at a CAGR of 25.86% over the forecast period (2021-2026). The global landscape of payments and transactions is changing rapidly, owing to the growing enterprises and consumer propensity toward digital transformation and the proliferation of smartphones. The technological advancements in smartphones, digital payment cards, and POS at retail terminals are fueling the market growth. In light of the COVID-19 crisis, the CD&V Party also encouraged people to get habituated to electronic, contactless payments. Besides, they proposed an awareness-building campaign to familiarize consumers and businesses with digital payments. 

  • More and more countries are moving toward becoming cashless economies, thus encouraging digital payment providers by incentivizing their consumers' digital forms of payments. For instance, according to a report from HSBC, in the UK, contactless card transactions revealed that the volume of commercial card payments, both debit, and credit, increased by 24% during 2019 and 2020, while commercial credit card cash advances slumped by 14% during this period, signaling a decline in businesses’ use of 'petty cash, as corporates make the shift to corporate cards.
  • In addition to this, the global consumer inclination toward payment methods involving smartphones is increasing in the form of contactless payment methods at POS systems, owing to which card and financial service providers are either offering their card solutions on smartphones or via third-party vendors. For instance, Goldman Sachs issued an Apple Card, which can be used to purchase Apple devices.
  • The stores and services worldwide are rapidly adopting and are integrating mobile payment applications, such as PayPal, Samsung Pay, Apple Pay, AliPay, and WeChat Pay, to accept payments. Due to the changing lifestyles, daily commerce, and rapid growth in online retailing, this trend is expected to continue over the forecasted period.
  • Additionally, the rising financial frauds worldwide have influenced the government regulatory bodies to secure payment transactions over the past few years. With customers demanding safe and reliable digital transactions, the need for using secure payment processes has increased. These regulatory bodies, therefore, have impacted the adoption of POS terminals positively. With the increasing mobility trends across the world, mobile POS systems are gaining traction. With the advent of cashless transactional technologies, POS is expected to witness an increase in adoption rates.

Scope of the Report

Contactless payment systems are credit card, debit cards, smart cards, or other devices, including smartphones and other mobile devices that use radio-frequency identification (RFID) or near field communication (NFC), e.g., Google Pay, Apple Pay, Fitbit Pay, Murphy, or any bank mobile application that support Contactless technology for making secure payments. The report also covers the impact of COVID-19 on the market.

TECHNOLOGY
Bluetooth
Infrared
Carrier-based
Wi-Fi
Other Technologies
PAYMENT MODE
Account-based
Credit/Debit Card
Stored Value
Smart Card
Other Payment Modes
DEVICE
Integrated POS
mPOS
PDA
Unattended Terminal
Contactless Reader
Other Devices
END-USER INDUSTRY
Retail
Transportation
Banking
Government
Healthcare
Other End-user Industries
GEOGRAPHY
North America
United States
Canada
Europe
United Kingdom
Germany
France
Rest of Europe
Asia-Pacific
China
Japan
India
Rest of Asia- Pacific
Latin America
Brazil
Argentina
Mexico
Rest of Latin America
Middle East & Africa
United Arab Emirates
Saudi Arabia
South Africa
Rest of Middle East & Africa

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Key Market Trends

Retail Industry to Hold Major Share

  • POS terminals across the retail outlets and a preference for mobile wallets while checking out from physical stores are primary drivers for this segment. According to Blackhawk Network, the mobile wallet adoption is expected to create nearly USD 190 billion as the transactional value in the US by 2021
  • The evolution of mobile-based POS (mPOS) includes a card reader connected to a basic ePOS app running on a tablet or smartphone. Merchant onboarding is simple, and the service is delivered on a ‘pay-as-you-go model. The initial target being the micro-merchants has observed a quick adoption by large enterprises for its convenience, competitive pricing, and value to the business and adding new store concepts.
  • A Divido study suggests the need for a more convenient option of paying, as 17% of UK-based consumers stress the availability of different finance options, and 36% admit they would shop again at a retailer that offers it. At the same time, retailers see benefits, such as increased customer loyalty and repeat purchases, increased basket conversions, and sales uplifts of up to 30% by implementing customer finance.
  • With initiatives such as Cashless India, and support from government apps, like BHIM, India is expected to be a growing market for mobile payments adopting across the retail sector. In February 2020, the Reserve Bank of India proposed setting up alternative digital retail payments organizations to encourage new payment systems as it aims to prevent a monopoly in a system currently dominated by the National Payments Corporation of India Ltd. (NPCI).
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Europe to Have Largest Share in the Contactless Payment Terminals Market

  • As per the National Association of German Cooperative Banks’ report, the number of digital payments increased by 35% in the first week of April 2020, as compared to December 2019. Mastercard International also reported that it had witnessed a dramatic increase in digital payments during the pandemic.
  • According to UK Finance, there were 1.6 billion debit and credit card transactions in the UK. Nearly a third of all card transactions in the UK were made using contactless cards. There were 642 million contactless card transactions, a 19.5 percent increase from 537 million a year earlier. Moreover, banks are integrating with mobile payment apps in the European region due to the increasing smartphone adoption. For instance, Apple is integrating with Monzo.
  • Further, The use of wearable devices for payments is continuing to take off in Europe, as consumers quickly and easily integrate this relatively new payment method into their daily lives. For example, a wearable device, a ring, bracelet, or smartwatch, has Near-field Communication (NFC) capabilities. There exists ‘passive’ and ‘active’ wearables. With a passive wearable, like a ring, the transaction can be approved by entering a PIN code on the payment terminal (just like with a plastic card). With active wearables, like a smartwatch, the PIN can be entered on the wearable itself, and payment can be completed with a single tap.
  • Additionally, Amidst the COVID-19 situation, contactless card limits across Europe have grown substantially as contactless payments were promoted across the continent. In 2019, there were only six countries in Europe where the contactless payment limit was EUR 30 or higher. For instance, North Macedonia had a contactless card limit of EUR 12. In 2020, this has more than tripled and reached EUR 41. These findings indicate that contactless payments are rapidly gaining popularity and will be the new norm in the post-pandemic era.
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Competitive Landscape

The contactless payment terminals market is consolidated because few players have a significant share of the market. Moreover, the lack of awareness of consumers towards contactless cards and concern over the security issue makes the market tough to enter for new players. Some of the key players in the market are Thales Group (Gemalto NV), OTI, VeriFone Systems Inc., Hewlett Packard, and Ingenico Group SA.

  • June 2020 - UnionPay International, Keenu (Wemsol Private Limited), and Bank AL Habib jointly announced the launch of the UnionPay QuickPass (NFC/Contactless and HCE) acceptance on Keenu POS terminals in Pakistan. The partnership between the three parties sees that customers can make a cleaner, safer, and quicker way to process whilst meeting anticipated compliance standards.

Recent Development

  • April 2020 - A survey by Mastercard involving 17,000 people from 19 countries who swapped out their top-of-wallet card for the one that offers contactless, this proportion reaches 52% among those under the age of 35 years. The majority of respondents (82%) view contactless as the cleaner way to pay. They said that they would continue to use the option once the pandemic is over.
  • April 2020 - Payments company K Wearables has selected Moorwand to provide BIN sponsorship and digital banking services for its contactless payment ring. The next phase of growth drives k Wearables’ migration to Moorwand as it evolves the product suite and expands internationally.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Assessment of COVID-19 impact on the industry

    3. 4.3 Market Drivers

      1. 4.3.1 Reduction in Queuing Time and Quicker Checkout Time

      2. 4.3.2 Convenience and Ease Associated with Contactless Payments

    4. 4.4 Market Restraints

      1. 4.4.1 Security Concerns Regarding Digital Payment

    5. 4.5 Porters Five Force Analysis

      1. 4.5.1 Threat of New Entrants

      2. 4.5.2 Bargaining Power of Buyers/Consumers

      3. 4.5.3 Bargaining Power of Suppliers

      4. 4.5.4 Threat of Substitute Products

      5. 4.5.5 Intensity of Competitive Rivalry

  5. 5. MARKET SEGMENTATION

    1. 5.1 TECHNOLOGY

      1. 5.1.1 Bluetooth

      2. 5.1.2 Infrared

      3. 5.1.3 Carrier-based

      4. 5.1.4 Wi-Fi

      5. 5.1.5 Other Technologies

    2. 5.2 PAYMENT MODE

      1. 5.2.1 Account-based

      2. 5.2.2 Credit/Debit Card

      3. 5.2.3 Stored Value

      4. 5.2.4 Smart Card

      5. 5.2.5 Other Payment Modes

    3. 5.3 DEVICE

      1. 5.3.1 Integrated POS

      2. 5.3.2 mPOS

      3. 5.3.3 PDA

      4. 5.3.4 Unattended Terminal

      5. 5.3.5 Contactless Reader

      6. 5.3.6 Other Devices

    4. 5.4 END-USER INDUSTRY

      1. 5.4.1 Retail

      2. 5.4.2 Transportation

      3. 5.4.3 Banking

      4. 5.4.4 Government

      5. 5.4.5 Healthcare

      6. 5.4.6 Other End-user Industries

    5. 5.5 GEOGRAPHY

      1. 5.5.1 North America

        1. 5.5.1.1 United States

        2. 5.5.1.2 Canada

      2. 5.5.2 Europe

        1. 5.5.2.1 United Kingdom

        2. 5.5.2.2 Germany

        3. 5.5.2.3 France

        4. 5.5.2.4 Rest of Europe

      3. 5.5.3 Asia-Pacific

        1. 5.5.3.1 China

        2. 5.5.3.2 Japan

        3. 5.5.3.3 India

        4. 5.5.3.4 Rest of Asia- Pacific

      4. 5.5.4 Latin America

        1. 5.5.4.1 Brazil

        2. 5.5.4.2 Argentina

        3. 5.5.4.3 Mexico

        4. 5.5.4.4 Rest of Latin America

      5. 5.5.5 Middle East & Africa

        1. 5.5.5.1 United Arab Emirates

        2. 5.5.5.2 Saudi Arabia

        3. 5.5.5.3 South Africa

        4. 5.5.5.4 Rest of Middle East & Africa

  6. 6. COMPETITIVE INTELLIGENCE - KEY VENDOR PROFILES

    1. 6.1 Thales Group (Gemalto NV)

    2. 6.2 OTI Global

    3. 6.3 VeriFone Systems Inc.

    4. 6.4 Visiontek Products LLC

    5. 6.5 Ingenico Group SA

    6. 6.6 Hewlett Packard Enterprise

    7. 6.7 Castles Technologies

    8. 6.8 ID Tech Solutions

    9. 6.9 NEC Corporation

  7. 7. INVESTMENT ANALYSIS

  8. 8. FUTURE OF THE MARKET

**Subject to Availability
** Qualitative Analysis

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Frequently Asked Questions

The Contactless Payment Terminals Market market is studied from 2018 - 2026.

The Contactless Payment Terminals Market is growing at a CAGR of 25.86% over the next 5 years.

Asia Pacific is growing at the highest CAGR over 2021- 2026.

Europe holds highest share in 2020.

Thales Group (Gemalto NV), OTI Global, VeriFone Systems Inc., Hewlett Packard Enteprise, Ingenico Group SA are the major companies operating in Contactless Payment Terminals Market.

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