The Contactless Payment Terminals Market is segmented by Technology(Bluetooth, Infrared, Carrier-based, Wi-Fi, and Other Technologies), Payment Method (Account-based, Credit/Debit Card, Stored Value, Smart Card, and Other Payment Modes), Device (Integrated POS, mPOS, PDA, Unattended Terminal, Contactless Reader, and Other Devices), End-user Industry (Retail, Transportation, Banking, Government, Healthcare and Other End-user Industries), and Geography.
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Scope of the Report
Key Market Trends
TABLE OF CONTENTS
Fastest Growing Market:
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The global contactless payment terminals market was valued at USD 13.23 billion in 2019 and is expected to reach USD 51.07 billion by the end of 2025, growing at a CAGR of 25.86% during the forecast year (2020 - 2025). The global landscape of payments and transactions is changing rapidly, owing to the growing enterprises and consumer propensity toward digital transformation and proliferation of smartphones. The technological advancements in the space of smartphones, digital payment cards, and POS at retail terminals are fueling the market growth.
More and more countries are moving toward becoming cashless economies, thus, encouraging digital payment providers by incentivizing the digital form of payments by their consumers. For instance, according to a new 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 2018 and 2019, while commercial credit card cash advances slumped by 14% during the year, 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 methods of payment 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 for purchases on Apple devices.
The stores and services across the world 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 across the world 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 uses radio-frequency identification (RFID) or near field communication (NFC), e.g Google Pay, Apple Pay, Fitbit Pay, Merpay or any bank mobile application that support Contactless technology for making secure payments.
By Payment Method
Other Payment Modes
By End User
Other End-user Industries
Rest of Europe
Rest of Asisa-Pacific
Rest of Latin America
Middle East & Africa
United Arab Emirates
Rest of Middle East & Africa
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Key Market Trends
Retail Industry to Hold Major Share
The use of POS terminals across the retail outlets and 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. With the initial target being the micro-merchants, it 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 who 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 India, with the Unified Payments Interface (UPI), an instant real-time payment system facilitated 799.54 million inter-bank transactions and a value of USD 19 billion as of March 2019, with 142 banks live on this interface. In February 2020, the Reserve Bank of India proposed to set up alternative digital retail payments organizations to encourage new payment systems as it aims to prevent a monopoly in a system that is currently dominated by National Payments Corporation of India Ltd. (NPCI).
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Europe to Have Largest Share in the Contactless Payment Terminals Market
Owing to increasing smart card rollouts and technological advancements, Europe is expected to lead the market with the largest share. According to the Electronic Transactions Association (ETA), contactless payments on the Mastercard and Maestro networks grew by 145% in Europe in 2018. Growth in contactless payments was robust across multiple countries in Europe, thus driving interest in wearable payments.
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 in January 2019, a 19.5 percent increase from 537 million a year earlier. Moreover, banks are integrating with mobile payment apps in the European region, owing to the increasing adoption of smartphones. 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. A wearable device, for example, 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 PIN code on the payment terminal (just like with 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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The contactless payment terminals market is consolidated due to few players are having the 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, Ingenico Group SA, among others.
April 2019 - OTI, a global provider of near field communication (NFC) and cashless payment solutions, announced that it had received a significant order for more than 6,000 advanced payment systems for use in Russian rail ticketing systems.
April 2019 - Hewlett Packard Enterprise (HPE) worked alongside Saudi Payments to provide an agile infrastructure to enable contactless (NFC) payments by mobile. The solution, built on HPE Synergy and using HPE 3PAR and HPE Synergy Image Streamer, provides an agile infrastructure, the highest levels of application performance and the fastest provisioning process, whilst meeting anticipated compliance standards.