Any innovation that drives a smoother process at the point of sale (POS) is a godsend these days. Take for example, mobile payment systems that are employed during holiday rush at some of your favorite stores. Cashiers may walk along a growing line and checkout customers who intend to pay electronically, using nothing more than a smartphone or tablet as a POS. Now, with wearable technology in the mix, that process is poised to become even more proactive.
According to a recent study by Tractica called “Wearable Payment,” the dollar value of payments made on wearables per year will grow from $3.1 billion this year to $501.1 billion by 2020. This amount will account for approximately 20 percent of the mobile payment market—which is currently dominated by devices such as smartphones—and a total of 1 percent of all electronic retail transactions.
The devices that will be leveraged in making these vast quantities of retail purchases possible are mostly wrist-worn. Smartwatches, which have seen exponential growth in the market since the launch of the Apple (News - Alert) Watch, fitness trackers, and wristbands designed specifically for mobile commerce, are projected to be the main drivers of growth.
“Wearable payments are just getting started,” says research director Aditya Kaul. “Apple Pay for the Apple Watch is the first big effort at enabling payments with the wrist. Soon to be launched, Android (News - Alert) Pay and Samsung Pay are other prominent digital wallet solutions that will support smartwatch payments.”
And that’s not all. Kaul also cited several forthcoming innovations that loom within sight.
“Key early market initiatives include trials and deployments of Barclays’ bPay system in the United Kingdom, Swatch’s partnership with UnionPay to enable wearable payments, Alipay’s partnership with Xiaomi in China, and Disney’s (News - Alert) successful deployment of its MagicBand closed-loop payment and ticketing system at its theme parks, among others.”
The beauty of wrist-worn wearables as payment methods is manifest in the complete transactional efficiency. Near field communications (NFC), radio frequency identification (RFID), and quick response (QR) codes and barcodes technologies, among others, mean that transactions can be made wirelessly. It also means no more sifting through pockets or bags for wallets. All it takes is the wave of a hand over a scanner, and you can be on your way with everything you need.
The Jedi would be proud.
Edited by Maurice Nagle
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