About Smart Cards : Introduction : Market Information
Smart Card Market Information
- Americas Smart Card Market Analysis Report
- Contactless Payments: Consumer Attitudes and Acceptance in the United States
The Frost & Sullivan Americas Smart Card Market Analysis report published in collaboration with the Smart Card Alliance in September 2005 predicts that the smart card industry will grow rapidly in North America, at a 27.7 percent compound annual rate over the next five years, from the 132.2 million cards shipped in 2004. Primary drivers for growth in North America include:
- The issuance of millions of contactless credit and debit cards in the U.S.
- The migration to EMV in Canada
- The deployment of FIPS 201-compliant ID applications by the U.S. government and the move to electronic passports and travel documents.
Other segments of the U.S. smart card market such as transit, telecom, pay TV, and enterprise physical and logical security are also leading the way toward the widespread adoption of both contact and contactless smart cards.
The report predicts even greater growth in Latin America, a 59 percent compound annual growth rate over the next five years, from 136.4 million cards shipped in 2004, with GSM, payment and loyalty the primary growth markets.
The Smart Card Alliance commissioned an independent survey of consumer attitudes toward contactless payment devices in August, 2006. The survey, conducted by Javelin Strategy & Research, concluded that there is a large, untapped market for the use of these devices. A significant majority of U.S. consumers are ready to adopt contactless devices for financial payments. Those who have already adopted contactless payment find the contactless experience to be uniformly positive and express a high degree of confidence in the technology.
Adopting contactless payments can be a win-win situation for consumers and merchants alike. The major factor driving adoption and use–convenience–represents a benefit for both parties to the transaction. Consumers are also willing to use contactless devices for both low- and high-value transactions and are open to trying contactless devices that are embedded in a wide variety of form factors.
The survey indicates that the major challenge to widespread use of contactless devices is reassuring consumers that contactless payment is safe. However, contactless payment appears to be an easy sell once information about it reaches the consumer. Both education and actual use alleviate consumer concerns about security.
A report is available summarizing the results of the consumer survey.