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Report: Payments via smartphones, wearables to top $95B by 2018

The bulk of contactless payment value will come from mobile phones, with wearables such as the Apple Watch making up only 2 percent of the total.

April 11, 2016

A new study from Juniper Research has found that the global value of mobile and wearable contactless payments is expected to reach $95 billion annually by 2018, up from less than $35 billion last year, according to a press release.

According to "Contactless Payments: NFC Handsets, Wearables & Payment Cards 2016–2020," the emergence of a range of connected wearables has caught the interest of NFC stakeholders. The report predicts that devices such as watches and wristbands will be in the vanguard of these developments, but cautions that the sector will take several years to reach critical mass.

Supporting research found that while nearly 9 million Apple Watches had been shipped by the end of 2015, these numbers were dwarfed the total for NFC-capable iPhones. As a result, wearables will not account for more than 2 percent of the value of noncard contactless payments by 2018.

The report questions the longer term prospects for closed-loop wearables such as Barclaycard's bPay range, which comes preloaded with account information, arguing that they represent a greater security risk than devices linked to credit or debit cards and protected by a secure element.