From watches, wristbands and jewellery to glasses and clothing, the popularity of wearable technology is booming, and so is wearable tech as growing payment opportunity.
Despite a relatively slow start, industry analysts estimate that 48 million wearable tech units were shipped in 2016. And, according to data from IDC, fitness bands topped the best sellers list, accounting for 85% of last year’s market.
Despite all the hype surrounding smart wearables – including devices like the Apple Watch – for the moment it appears that basic wearable devices reign supreme.
But IDC predicts that, as user tastes evolve, the opportunity for smart wearables – multi function devices equipped with third-party applications – is set to burgeon. And payment looks like being the transformational application that captures the public imagination and drives the mass take-up of wearable tech.
Indeed, according to Gartner, half of consumers in major markets – including North America, Japan and Western Europe – will be using a combination of smartphones and wearables to make payments by 2018.
The appeal of wearable payment for consumers is easy to understand. The ability to use items worn on the body to quickly and easily pay for goods and services takes the convenience of mobile and contactless payment to a new level.
Payment providers, meanwhile, are seizing on the world of possibilities wearable tech opens up. But the more sensitive the data stored on such ‘devices’, the more tantalizing become the opportunities for cyber criminals and fraudsters. So what are the security issues, and how can these be addressed?
This paper, published by the Smart Payments Association, and excerpted here, explores wearable tech from a payments perspective, analyzing the current market and evaluating the future prospects it affords consumers, institutions, and the wider payment ecosystem.