Wearable payment devices have witnessed noteworthy growth in the past few years. With the introduction of Host Card Emulation (HCE) and cashless payment methods, several financial institutions and banks have started utilizing the features of these electronic payment devices in order to expand their current customer base. Rise of HCE is attributed to growth is demand for wearable payment devices, as HCE allows wearable devices to allow card imitation on NFC-enabled devices without depending on access to an authenticated element. Furthermore, NFC, RFID, and HCE technologies are integral parts of wearable and contactless payment devices, owing to their features that support a seamless transaction experience.
Several manufacturers such as Samsung Electronics and Apple Inc. are integrating payment technologies into their wearable devices to cater to rising customer demand. Additionally, reduction in the cost of NFC technology installation has also contributed to market growth. Wearable payment devices offer a secured shopping experience to customers by using advanced technology incorporated in them.
As per the new report published by an ESOMAR-certified market research and consulting firm, the global wearable payment devices market is anticipated to exceed a valuation of around US$ 15.6 Bn by 2021, and is expected to expand at a mammoth CAGR of around 29% over the forecast period of 2021 to 2031.
Key Takeaways from Market Study
- South Asia is estimated to witness major growth during the forecast period (34% during 2021 – 2031).
- North America is anticipated to register the highest market share of around 31%, followed by Europe.
- In 2020, North America and Europe together accounted for 57% of global wearable payment device sales. The European market is expected to offer over US$ 35.6 Bn absolute dollar opportunity over the next ten years.
- In terms of device type, fitness trackers and payment wristbands together held around three-fourth of the global market share in 2020.
- Under technology, barcodes are estimated to cover a higher market share, accounting for around 30% of the market.
- Among the applications, with over 28%, retail accounted for the highest share of wearable payment devices.
“Globally, growing cyber-attacks during online and mobile payments has promoted the adoption of contactless payment through wearable payment devices,” says a report analyst.
Barcodes are widely used by vendors owing to their features such as scan and go technology. In the near future, barcodes are expected to showcase further growth as there is an increase in the number of barcodes available at vendor and retailers. Cashless transactions are mostly carried by barcodes, and this has supported market growth for wearable payment devices, as now manufacturers are offering easy scanning features in wearable devices to attract more customers.