Canada vs the World in Contactless Payment Systems & Technology

When it comes to contactless payment technology infrastructure, Canada is on the right track thanks to its industry players’ receptiveness and readiness to update systems and support new technology. In fact, according to Visa’s website, payWave transaction penetration was 22.0% in 2015, and as of June 2016, this penetration increased to 32.7%. There are approximately 21 Visa payWave transactions every second in the Canadian market. Visa Canada predicts this number will continue to rise for the next 10 years. Evidently, contactless payment technology is booming domestically. But what about the rest of the world? MONEXgroup seeks to investigate and compare Canada versus the rest of the world in contactless payment technology implementation and usage.

Currently, 8 out of 10 Canadian retailers have terminals with NFC capability and 10% of transactions are made contactless. In Canada, contactless chip cards are the preferred means of payment, whereas the U.S. is more geared towards payment via Smartphone since most cards issued south of the border lack contactless capability. In summary, 80% of major Canadian retailers now accept contactless payments and 10% of domestic transactions are contactless.

Canada’s contactless payment technology is growing rapidly at a rate of 16.4% per year. MasterCard’s issuance of contactless payment technology supported cards featuring “Tap & Go” is highest in Canada with 99% of consumer credit cards being contactless enabled. MasterCard’s contactless footprint has expanded to include the overwhelming majority of Canada’s top retailers and enabled Canadians to tap their cards more than 330 million times.

Interac Flash is now estimated to be activated in over 50% of Debit cards in Canada and rapidly expanding was virtually all new Debit cards being issued include the Interac Flash contactless technology. A study conducted by Technology Strategies has revealed that over 50% of Smartphones in Canada will be near field communications compatible by 2017. It’s only a matter of time until payment via mobile devices becomes the new norm.

Australians favour contactless payments on a daily basis. Australian merchants are seeing a high demand for contactless payment technology and are rolling out modernized terminals to keep up with this trend. More than 58 million Visa PayWave payments were made in July 2014. According to a report by Australian bank Westpac, contactless payment technology via mobile reached $3 billion by 2015. In Australia, mobile-based contactless payment technology has accounted for 60% of all debit-card transactions in a 12 month period starting November 2013.

Japan is one of the first countries to witness the rollout of contactless wallets largely based on Sony’s FeliCa. Japan has largest penetration of NFC enabled POS systems in the world. There are more than 70 million NFC-enabled devices in Japan, as opposed to 3 million in the U.S. In Japan, NFC itself finds a wide variety of applications from micropayments to branding of products.

Nine Polish banks launched Visa Cloud-based Mobile Contactless Payment technology in early 2015, re-enforcing Poland’s reputation as a hub for innovation in digital payment services. Poland has been extremely enthusiastic in embracing contactless payment technology and is Visa’s largest market in Europe in terms of per capita transaction volumes. Statistically speaking, 70% of Visa cards in this market have contactless functionality, with the technology accounting for more than 40% of all Visa payments in Poland.

In August 2013, Singapore hit 1 million Visa payWave transactions per month. For the month of July in 2014 alone, Visa processed more than 2 million transactions, which made up for 21.5% of face-to-face interactions. Paying by waving a card over a terminal is becoming a common practice in the country. In fact, Ez-link is the biggest issuer of contactless payment technology cards, with over 15 million issued since its launch in 2008.

Growth of the mobile contactless market in South Korea can be attributed to the spread of mobile contactless payment processing terminals amongst the masses. In May 2012, it was accounted that approximately 200,000 terminals were capable of accepting MasterCard Tap & Go PayPass and Visa payWave.

Contactless payments represent a €9.5 billion opportunity in Sweden. Top Swedish mobile operators such as Telia, Tele2, Telenor and Three had launched WyWallet which is a mobile payment app that offers mobile services for up to 97% of all Swedish phone users. WyWallet has almost 1.2 million users, which accounts for 20% of the 6 million mobile users in the country. Sweden is one of the first European countries to adopt contactless payment technology and mobile payment, and while ditching paper payment such as cheques and cash. It is expected to become the world’s first truly cashless society.

This East Asia country witnesses more than 900,000 contactless transactions per month. In December 2014, 27 Taiwanese banks signed up for Gemalto’s Trusted Services Hub (TSH) in order to launch NFC payment services. The top five telecom companies in Taiwan are heavily promoting NFC enabled mobile transactions and payments. There are over 24,000 contactless terminals in Taiwan across stores, taxis, restaurants, malls and movie theatres.

Turkey is one of the most advanced countries in Europe in terms of contactless payment technology adoption. By the end of Q2 in 2012, 14 out of 27 major banks issued contactless cards, resulting in more than 6 million contactless cards issued. There are about 60,000 POS terminals in Turkey that have contactless readers installed. Most ATMs encompass contactless readers, while naturally every Starbucks branch has contactless point-of-sale (POS) terminals.

In the UK, the contactless POS market is growing at a rapid 26.7%. In 2014, £380.8 million was spent via contactless cards. Visa Europe predicted that, with the launch of contactless journeys on Transport for London’s (TfL) travel network and the introduction of mobile payments, British people made 500 million contactless payments between the years of 2015 to 2016. In the UK, contactless payments are viewed as normal across all age groups and more than half of British people surveyed use contactless cards in 2016 at a rate of 58%, which has increased 20% from 2015.

As one can see, like the rest of the world, Canada is jumping on the contactless payment technology bandwagon in a competitive way as more and more Canadians are finding the ease and convenience of using NFC POS terminals. This development is advantageous for Canadian POS industry as it puts the country on the map for the rest of the world to see… particularly for less advanced nations on our continent.

MONEXgroup is a world leader in contactless payment technology as we are the one and only payment processing company in Canada that integrates contactless only payment technology into any self-serve kiosk or vending machine with PCI certification for Visa payWave, MasterCard Tap & Go, Interac Flash and Mobile Payments such as Apple Pay.

For example, MONEXgroup’s contactless unattended payment solutions can be found exclusively in residential Laundromats with over 50,000 machines installed in Canadian apartment buildings. Tenants no longer need cash for their laundry; they simply purchase and add money to their “laundry smartcard” via Credit or Debit card. Furthermore, we now service nearly 100% of the air pumps at gas stations across the country… gone are the days of digging for the right change for tire inflation, all customers have to do is tap their card or mobile wallet and pump away. MONEXgroup’s contactless payment technology is ideal for Drive Through looking to improve speed of service and customer experience. Our contactless only module can be integrated into food vending kiosks, facilitating instant payments and speeding up the queue. Grabbing a cup of coffee, bottle of pop or a bag of chips has never been so easy for customers and hands-free for management of payment collection. Vending operators can just relax and watch the revenue accumulate. So, what are you waiting for? Embrace the future and contact MONEXgroup today to discuss your integration requirements for a self-serve vending solution that will help leapfrog existing technology and accelerate your business!

When partnering with the number one Canadian merchant services in Canada; MONEXgroup payment processing will increase your efficiency and quality of service and lower the related costs. Request a Cost Comparison Analysis today.