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New merchants to fuel contactless growth in North America

April 11, 2006

Digital Transactions: Shipments of contactless-payment transponders - the cards, keyfobs and other devices consumers use to make radio-wave payments at the point of sale - are expected to explode this year. According to ABI Research, an Oyster Bay, N.Y., research firm, contactless-payment transponders shipments will reach 45 million units, up from 13 million last year. Most of that growth will come from North American market, where contactless payments took off in 2005. One thorny issue for smaller merchants, however, is that subsidies the card companies have offered to fund contactless equipment in the past are likely to end. That lack of funding will likely pressure acquirers to sharpen the business case for contactless payments.

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