Contactless payments via cards and mobile phones are transforming in-store shopping, with retailers racing to ensure they have the equipment needed to keep up with customer expectations.
According to research from Statista, by 2021, Near Field Communication (NFC) or other contactless payment technologies are projected to generate nearly $190bn in sales in the US, up from $113bn this year.
For an idea of how quickly contactless payments have changed in-store retail, consider that only four years ago, they generated just $9bn in sales in the US.
With smartphone payment technology at the forefront of the change, plus alternative banks emerging from the likes of Apple and Monzo, offline retail equipment is changing to emulate the payment simplicity of the online experience.
75 Million Contactless Mobile Payment Users by 2022
While modern payment cards now feature contactless chips, a huge number of tap-to-pay transactions now come from mobile phone users. The latest Android or Apple smartphones have contactless payment abilities built-in, with fingerprint or face recognition technology used to secure transactions.
According to research compiled by Statista, the number of proximity mobile payment users in the US alone is set to rise to 75 million by 2022.
This rapid adoption – up from 16m users in 2014 – is driven in a huge part by the wide usage of Apple Pay on newer iPhone models. Apple claims that it's on track to see 10bn Apple Pay transactions across 2019.
Apple payments won't simply go out via iPhones, either. Just last month, the company unveiled a new Apple credit card.
Customers will be able to use it with Apple Pay worldwide, and will get 2% of credit card purchases back in “Daily Cash,” a same-day delivery of money into their account. The card is made out of laser-etched titanium, helping it stand out even more against traditional credit cards.
Additionally, new “digital-only” banks, such as Monzo, are giving consumers further flexibility to pay via contactless – either using a phone, or a chipped payment card.
Point of Sale Brands Embracing Contactless
With the number of consumers making contactless payments on the rise, it's no surprise that Point of Sale (POS) system providers are evolving their equipment fast to keep up.
Leading POS systems provider Shopify is just one of the brands adapting to these changes. Shopify has announced a range of new retail hardware devices, including a Tap & Chip Reader, Dock, and Retail Stand.
These products join a competitive retail equipment market that's transformed in recent years to keep up with consumer demand for contactless NFC payments. Square POS, for example, also offers small, unobtrusive contactless and chip readers that customers can tap on with a phone or card to make small payments.
In part, these contactless POS systems aim to replicate the ease-of-payment that modern consumers are accustomed to when shopping online. But it's an opportunity, too, for retailers that have successfully established themselves online to succeed with customers in-store. “Digitally native brands want to build loyal audiences through retail locations,” says Craig Miller, chief product officer for Shopify. For the experience to match up, the interface needs to feel effortless for the shopper.
Read more about POS systems on Tech.co
Tech.co is reader-supported. Using Tech.co's comparison form, you can receive quotes from various suppliers, tailored to the needs of your business. If you enter into a contract with a provider, we may receive a payment for the introduction. Equally, if you make a purchase through the links on our site, we may earn a commission from the retailers of the products we have reviewed. This helps Tech.co to provide free advice and reviews. It carries no additional cost to you, and doesn’t affect our editorial independence.