07 Jun 2012

Shipments of NFC-ready POS terminals set to soar

According to a new research from Berg Insight, the market for NFC-ready POS terminals grew fiercely in 2011 with annual shipments doubling to an estimated 2.5 million units worldwide.

The rapid growth was driven by a transition in the NFC-payments ecosystem from performing trials to accelerating the rollout of NFC-ready payment infrastructure, in preparation for the arrival of NFC-based mobile payment services.

Berg Insight forecasts that the global installed base of NFC-ready POS terminals will grow at a compound annual growth rate (CAGR) of 49.4 percent from 3.9 million units in 2011 to 43.4 million units in 2017. This corresponds to an increase in the penetration rate from 8 percent in 2011 to 53 percent in 2017.

The penetration rate is projected to be highest in North America where an estimated 86 percent of the terminals will be NFC-ready by 2017. The penetration rate in Europe and the rest of the world will be 78 percent and 38 percent respectively.

Berg Insight expects that the emergence of mobile wallet services will be the most significant development in the payments industry during the next few years.

“Mobile wallet services will create an unprecedented opportunity for retailers to interact with consumers in real-time while their purchasing decisions are being formed, for instance by delivering personalised offers in real-time while consumers are inside the shop”, says Lars Kurkinen, Telecom Analyst, Berg Insight. "Support for value-added services such as coupons, loyalty cards and daily deals will need to be integrated at the point of sales terminal to enable a seamless shopping experience for the consumer."

The analyst's study also explores the use of mobile payments in market segments such as vending and parking.

“In the parking market a growing share of transactions are initiated from mobile phones instead of parking meters. This development is pushing major parking meter vendors to diversify into the pay-by-phone parking market”, says Kurkinen.

He adds that SMS-based payments for vending are gaining momentum in some parts of Europe. An example is Selecta, the leading European vending operator, which recently rolled out SMS-payments to all of its public vending machines in Switzerland.

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