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Critical mass for contactless cards in 2016-18

Contactless cards continue to grow with increasing appetite from all stakeholders including consumers, who find it convenient, and merchants who like its speed – particularly where there is a requirement to move people very quickly through the payment experience, such as mass transit and fast food.

This, coupled with the merchant acquirers offering lower merchants costs, compared to debit and credit andContactless-NFC is the de facto standard - when do you see critical mass in acceptance savings in the cost of managing coinage, is a strong incentive for driving contactless acceptance.

A key question in the Digital Payments Report 2016 was to ask respondents the the associated survey when they expected to see critical mass in acceptance for Contactless. Whilst there was some difference in the 2016 timeline, there is general agreement across all three regions that critical mass adoption is more likely to Contactless-NFC is the de facto standard - when do you see critical mass in issuance and usageoccur in the 2016 to 2018 timeline.

On the issuing side, much of the drive behind contactless/NFC technology is coming from mobile contactless. The Digital Payments Report 2016 believes the arrival of Apple, Samsung and others, with in-built biometric authentication technology in the handset will drive greater usage. LG and HTC are also set to launch handset manufacturer wallets for their users in 2016.

Digital Payments Report 2016 also asked survey respondents when they expected to see mass issuance and usage of contactless. Again there was some variation across the regions in 2016. Unsurprisingly Europe, with its longer heritage in the EMV chip card market, dating back to the late 1990’s, being the most optimistic. That said there was consensus across all three regions that 2016 – 2018 would be a major growth window.

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