The Development of NFC Payments to Reach a Higher Level

According to Juniper Research, a new report has showed that the global NFC retail payments market will exceed $180 billion by 2017, increasing more than seven times compared to 2012. As smartphones with NFC payment technology become standard, the leading regions, including North America, Western Europe and Far East, will contribute 90% of this market value.

The report found that 2011 was a watershed year for NFC payments. Standards for major technology infrastructure were finalized, many mobile network operators invested in the market, and NFC payment pilots from both mobile operators and financial institutions gradually turned to commercial service. And above all, NFC-enabled smartphone models were announced by the majority of handset manufacturers, and Google ignited the market with its Google Wallet.

However, the report warned that the acceleration of the market in 2011 revealed some parts of the ecosystem unprepared for the future. Particularly, retailers are not as convinced of the benefits of NFC payments as the existing card technologies, so they are unwilling to invest in contactless infrastructure so soon after the transition to CHIP&PIN. Education and “win-win” propositions are necessary to make retailers take this opportunity.

“This is a critical time for the NFC retail payments market. Despite the significant progress being made today, the full potential of the market can only be fulfilled if all ecosystem players are equally committed and mobile wallet consortia remain in place.” said Dr. Windsor Holden, co-author of the report.