Given the abundance of hacking and “snoopers” that can sniff your PIN, so-called chip cards seemed like a good idea. But the inconvenience – every merchant seems to have a different way to handle them plus there is a noticeable time delay – this ecommerce shopper is ready for “contactless,” or mobile wallet, transactions such as Apple Pay. So are millions of others, says a new study from Juniper Research.

These contactless payment systems rely on NFC, or near-field communications, to conduct transactions from your wireless device.

And their popularity is surging.

“We would envision that total mobile wallet transactions will reach $1.35 trillion in 2017, up by 32% on the $1.02 trillion recorded last year,” Juniper reports.


Blame the chips.

These so-called smart cards rely on EMV – “a technical standard for smart payment cards and for payment terminals and automated teller machines that can accept them,” notes Wikipedia.

However, the system often requires customers to use their PIN numbers – and, personally, I have been reluctant to ever use a PIN since I learned that a snooper at a gas station might pick off mine. Now, at virtually every place I shop, a pin is required.

There’s another problem – convenience.

“The transition to EMV has reportedly provoked a degree of resentment amongst US consumers and merchants, in part attributable to the greater time taken to fulfill a transaction (7-10 seconds vs 2-3 seconds for traditional swipe card),” Juniper reports.

“Hence, if transactions can be fulfilled more quickly (and the transaction speed for offline Apple Pay transactions is typically 2-3 seconds) then merchants can benefit from greater throughput at POS [point of sale].”

Emerging tech in U.S.

Unfortunately, in the U.S. so-called wallet pay systems from Apple and Samsung are not yet ubiquitous.

Juniper describes the availability as a “paucity of contactless cards” in the U.S.

So, the researchers expect Apple Pay and others to fight for dominance in a rapidly emerging markets.

“The challenge,” Juniper notes in a whitepaper titled War of the Wallets, “facing Apple and its rivals is to ensure that the infrastructure is in place for consumers to make instore payments.” Apple says just 6 percent of retailers are enabled for such technology.

So who will lead the way in such payments? Apple? Saumsung? Android Pay?

Juniper sees a big opportunity for PayPal, which already has a worldwide presence through PayPal Wallet through which 1.37 billion transactions were made via a mobile device in 2015. That was 28 percent of all PayPal transactions.

Market opportunity

And the market opportunity is huge as more customers gravitate to mobile wallets.

“We would envision that total mobile wallet transactions will reach $1.35 trillion in 2017, up by 32% on the $1.02 trillion recorded last year,” Juniper says.

The biggest market is China at some 52 percent with the Indian Subcontinent rising to 11 percent from 8 percent of transactions.

So far, the U.S. continues to lag. But as more consumers and businesses grow increasingly frustrated with chip cards, watch out for wallet wars to sweep this country, too.

Read more at: