July 10, 2015
A new era of payment has begun in recent times: NFC, smart chips, Google Wallet, and Apple Pay. Yes, we are talking about contactless payments. Contactless payment systems are devices that use radio-frequency identification (RFID) or near field communication (NFC) to make secure payments. Contactless payments have been around since 1997, Mobil being one of the early adopters. Since then, major players in the industry have begun adopting this technology considering the amount of effort and resources that have been saved. Indeed, the benefits of contactless payments outweigh the adoption costs associated with it. Both the consumer and the retailers can enjoy the benefits of contactless payments. Consumers do not have to worry about carrying cash or cards while shopping and can enjoy an easier payment mechanism. Retailers can also benefit from this as faster checkouts mean customers spending less time at the POS terminal and retailers serving more customers.
In Europe, the United Kingdom leads in the number of Visa contactless cards issued last year whereas Spain has the most contactless POS terminals. Europe surely has welcomed this innovative change in the card payment industry. According to mirror.co.uk, there are 131 million Visa contactless cards that are carried and used at 2.6 million contactless POS systems across the continent. Last year, a billion contactless transactions were made in Europe alone. Major card issuers and brand merchants have laid the platform for the early adoption of the contactless payment technology. It also says that by 2020, all Visa POS terminals in Europe will accept contactless payments. More importantly, contactless payment is not just about waving your Visa card on the POS terminals of major retailers. Barclays Bank has partnered with Transport for London (TFL) to integrate the Oyster card with Barclaycard. TFL customers can use their Barclaycard to pay for their travel on any TFL service. Key fobs, phone stickers and wristbands are some of the contactless payment devices being introduced by major banks around Europe. Apple Inc. has recently launched Apple Pay for the UK market and iPhone users can now pay contactless at 250,000 locations across the country. Google already offers Google Wallet and is all set to introduce Android Pay.
Evidently, we can see from the above findings that contactless payments will be the preferred medium for making payments. The rapid boom seen in this technology asserts the fact that nearly all of the Europe will adopt contactless payments by 2020. As more and more consumers adopt this new mechanism of payments, retailers will also have to cope up with the demand and provide NFC POS terminals for their customers. We will be able to see contactless POS terminals at almost every place where payments are involved. In fact, this will also lead to contactless POS terminals becoming one of the service offerings to attract customers. Rapid changes are bound to happen in the way payments are made.