NFC Mobile Payments Spend ‘to Hit US$100bn in 2016’
The total value spend of near field communication (NFC) mobile payments will rise from US$4bn in 2012 to break the US$100bn level in 2016 and accelerate to US$191bn in 2017, according to ABI Research.
The firm predicts that the increase in such payments will occur despite Apple rejecting NFC for its latest smartphone, the iPhone 5, or its mobile operating system, iOS 6. Mobile payments and more importantly the convergence between payment types – proximity, peer-to-peer (P2P) and online – stored on a single NFC handset will be the initial trigger, driving market convergence across a host of other markets, including ticketing, retail, loyalty and access control.
Market convergence is not quite ready for mass commercial roll out, but the potential value add that NFC brings has been identified. Smart card and IC vendors, device OEMs, MNOs, partnering service providers, and payments networks are all set to benefit, should convergence prove successful. “Market convergence is at least two years away from reality,” said ABI research analyst, Phil Sealy, suggesting that Apple – which currently promotes its Passbook mobile payment software, which runs on iOS 6 – will have to address NFC sooner rather than later.
ABI believes transportation and ticketing will be the first market to benefit from convergence, with 26% of all NFC handsets forecast to house a contactless ticketing application in 2017. “Transport authorities will have the ability to offer additional added value services, including route planners, delay bulletins, time tables, as well as retail and loyalty, or advertising applications offering own brand or partnering/local business a platform to offer additional solutions to generate new revenue streams,” said Sealy.