The global contactless point-of-sale terminals market is expected to grow at a CAGR of nearly 26 percent between 2017 and 2021, according to a new report from research firm Technavio.
In a press release focusing on the new research, Technavio said the retail and hospitality markets are the two largest users of contactless POS terminals, with the retail sector accounting for more than 66 percent of market share last year. According to the research firm, the main reasons merchants are embracing contactless payments include a strong value proposition for customers, increasing awareness about contactless payments as a means to pay and the presence of large smartphone OEMs in the contactless payment software market.
According to Technavio, the contactless POS terminal is fast and reliable, which makes it appealing to certain industries. The time taken for a single transaction is much less than the traditional chip-and-PIN method, it said, noting users have a higher value addition as they do not need to key in the PIN in public or hand the card to the POS operator. For the merchants, Technavio said, value lies in faster checkout times, with merchants saving time as more customers can keep moving through the terminal faster. This also helps in forming smaller queues in front of the payment terminals, noted Technavio.
“The contactless POS terminal system was predominantly used for subways and other forms of public transportation entry terminals in developed countries such as the U.K. and Poland a few years back. The trend soon caught on and got incorporated into the retail sector and hospitality sector, as well due to the significant value addition for customers, as well as merchants,” said Chetan Mohan, a lead analyst at Technavio for computing devices research.