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China drives 27 percent growth in EMV, contactless card shipments

EMV migration in the U.S. and the increasing adoption of contactless payments in Europe are also growth factors, says new data from ABI Research.

August 4, 2014

Chip card volumes reached shipment levels totaling 1.67 billion in 2013, an increase of 27 percent compared with 2012, according to the new ABI Research study, "Payment and Banking Cards & Contactless Technologies Market Research."

Growth was primarily driven by China's migration to the PBOC standard — the chip card specification issued by People’s Bank of China.

In 2013, 442 million PBOC smart payment cards shipped into China. Of that total, 56 percent were contactless, with the remainder primarily made up of contact-based payment and social security cards.

However, EMV migration in the U.S. and the increasing adoption of contactless payments in Europe are also growth factors, the study found. ABI Research expects a doubling of worldwide shipments, with 3.3 billion forecast in 2019, and is forecasting double-digit annual growth to 2017.

Still, excluding China, global growth year over year would have been just 8.5 percent between 2012 and 2013, which highlights the effect this single country is having on the overall worldwide picture.

"It has arguably been a slow road to realization, but EMV card issuance is now likely to begin in 2H 2014, off the back of tenders and orders placed in 1H 2014," ABI Senior Analyst Phil Sealy said in a news release. "With over 1 billion payment cards in circulation the 'China effect' could well be replicated within the United States. Moving forward, Indonesia will likely provide another growth trigger and other large countries such as India will add further growth with current expectations that it will begin large scale migration in 2016."

The ABI study comprises data points across all major regions and 28 individual countries and provides chip and mag stripe data splits for ATM-only, credit, debit, and open-loop prepaid cards.