EMV Use Continues Rise; Contactless Payments Coming: U.S. Payments Forum
The change will likely occur most in metro areas with big transit systems that are migrating to EMV contactless payments.
Virtually all of the nation’s major retailers are now able to process EMV chip cards, and chip transactions today make up most of the transaction volume in the United States, according to new data from the U.S. Payments Forum.
The organization, which is a nonprofit that supports the introduction and implementation of emerging payments technologies, said in its latest quarterly snapshot that 99% of the country’s top 200 retailers are now chip-enabled and 60% of overall transaction volumes are chip-on-chip transactions.
More than 50% of transactions now take place at merchants that have enabled contactless payments, it added. However, credit unions and other card issuers probably shouldn’t expect sudden shifts in member behavior on that front.
“Unlike other countries that moved swiftly to contactless payments, we won’t have a ‘year of the contactless payment.’ Instead, the payments industry will focus on giving consumers the choice to use contactless where speed and convenience is highly valued, and as a result of that, contactless and mobile transaction volumes will grow over time,” U.S. Payments Forum director Randy Vanderhoof said.
Contactless and mobile wallet transaction volumes have ticked up steadily, but most card issuers and merchants are evaluating the business case and planning for next year, Vanderhoof said.
Vanderhoof also predicted that more merchants will become able to accept the dual-interface cards expected to hit the market in 2019. The change will likely occur most in metro areas with big transit systems that are migrating to EMV contactless payments, Vanderhoof noted.
Globally, contactless payments appear to be growing rapidly. Recent research from technology advisory firm ABI Research found that over half of all payment cards issued in the world this year will be contactless. That amounts to about 1.5 billion contactless cards issued in 2018; by 2022, issuers will pump 2.3 billion contactless cards per year into markets around the world, it projected. Much of the growth appeared to be coming from contactless-card migration in the United States, as well as in India, Southeast Asia and Latin America, the organization reported.
Those findings followed another study, that one by Juniper Research, which found that by 2020, 30% of in-store purchases will be made with contactless payment cards and mobile wallets such as Apple Pay, Samsung Pay or Google Pay.
Juniper Research projected that in-store contactless payments will hit $1 trillion this year and $2 trillion globally by 2020, representing 15% of total point-of-sale transaction value. It had previously predicted that the world would not pass the $1 trillion mark until 2019.