Aite Study: Gathering Steam, NFC Payments Set to Skyrocket (May 18, 2015)
Proximity payment transaction volume is estimated at $7.5 billion this year and is expected to grow gradually before skyrocketing to $487 billion in 2020, according to an Aite Group report, “Mobile Proximity Payments: A Disruption in the Force.” A key factor for the rapid growth of mobile proximity payments is the currently limited distribution of NFC-enabled terminals that will be ramped up by large store chains in coming years, according to Thad Peterson, Aite Group senior analyst.
“With only one in five locations NFC-enabled by 2016, opportunities to use NFC mobile proximity payments will be limited,” Peterson tells Paybefore. “However, it’s likely that the highest penetration of NFC-enabled terminals will be larger, national merchants so consumers may find that they can use NFC payments in many of the locations they most often frequent.”
Transaction volume is expected to grow to $22.4 billion next year, $50 billion in 2017, $107.7 billion in 2018 and $226.6 billion in 2019, before more than doubling in 2020.
The rapid growth of mobile proximity in later years will be driven by a combination of increased availability of NFC-enabled terminals, increased consumer comfort with mobile proximity payments and an increased penetration of mobile wallet-enabled phones, Peterson says. “Remember, we’re only in the first generation of [NFC-enabled] iPhones with Apple Pay, and Samsung has yet to release its payment platform,” he adds. The culmination of all these factors will take a while he says, but when they do, mobile proximity payments “will take off.”
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