Identity, Security, Payments, Biometrics, Smart Cards and Authentication News

Commercial rollout of contactless payments to occur as multiple issuers deploy 'millions' in '05

Wednesday, December 15, 2004
&A panel of ID industry experts provided predictions for 2005. One of these glimpses into the future will appear here each day during December. If 2003 and 2004 were the “pilot” years for contactless payments in the United States, 2005 is turning out to be the commercial roll out year, with several major deployments scheduled. Speed and convenience are the major driving forces for these deployments, but not the only factors. Increased transaction volume and transaction amounts along with “top of wallet” effects have been recognized in the pilot programs as clear benefits for retailers that predominantly deal with cash transactions and have long lines of customers at their check out lanes during peak hours.

A considerable number of national brand retailers will start accepting MasterCard’ PayPass, American Express’s ExpressPay or Visa Contactless cards/fobs at their store locations. To date, McDonald’s has already announced its acceptance of PayPass devices at all of its 13,500 fast food locations. Similar deployments are expected from other national as well as regional retailers.

Equally, multiple card issuers are planning to issue contactless payment cards/fobs by the millions in 2005 here in the U.S. Some of the issuers have a regional focus, and some plan to do a national roll out.

Branded retailers will also be expanding their loyalty card, gift card, and pre-paid card programs using contactless technologies. Some of these retailers are already preparing for such programs to start in 2005.

Besides retailer-specific deployment activities in 2005, there will be dozens of closed system contactless payment solutions targeting stadiums, universities, corporate campuses, and ethnic communities. Some of these developments already started in 2004, leveraging contactless technology.

Next year will also be exciting on two additional fronts. First, contactless payments are already being planned for pilots and limited roll-outs in Asia, Europe, and Latin America. Secondly, there will be multiple exciting pilots here in the U.S. and abroad using NFC-enabled mobile phones.

In short, 2005 will be an exciting commercial launch year for the contactless payment in the United States while the rest of world will get ready for theirs in 2006.


Visit ViVOtech on the web at www.ViVOtech.com.

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