NFC tech driving shift from contactless card to device first approach

The study, conducted by ABI Research highlights the accelerating migration from physical to digital wallets, with more than 80% of those surveyed confirming that they have used a smartphone or smartwatch to make contactless payments. Security, convenience, and future digital wallet innovations cement the growing trend towards device first approaches.

For the first time ever, the study found that the majority of consumers prefer to use their mobile phone or wearable to pay over a contactless card. Additionally, when compared to other payment options including contactless cards, QR Codes, and cash, consumers rated NFC contactless as the most secure, most convenient, most reliable, and easiest way to pay in-person.

The study provides a renewed understanding of consumer adoption, familiarity, and experience with NFC technology at both a global and regional level, with 55% of respondents saying they would prefer to use their smartphone or smartwatch to make a payment rather than their card. Ninety-five percent of those surveyed have left their physical wallet or purse at home on at least one occasion, choosing instead to rely solely on mobile payments. Fifty-three percent confirmed they do so multiple times each week.

“The 2024 Study highlights a significant paradigm shift in the way that people use their contactless devices,” comments Andrew Zignani, Research Director at ABI Research. “Daily use of mobile payment platforms is becoming increasingly common, with users citing the security, reliability, and convenience of digital solutions as core driving factors. As familiarity and understanding of NFC continues to grow, so too does demand for additional applications and use cases for the technology. We are now entering an end user perception step change whereby NFC is not just considered a payments technology, but a technology that can underpin a variety of different applications and use cases, such as the ability to tap to receive additional product information, for digital car and/or house key storage, use across brand protection or tap to register a product warranty to name but a few.”

Mike McCamon, Executive Director of NFC Forum, adds: “NFC technology enables the creation of efficient, reliable, secure, environmentally-friendly, and smart solutions. And with emerging concepts such as multi-purpose tap – an evolution of NFC that allows users to complete multiple required actions in a transaction in a single tap – device makers and solution providers are being empowered to create transformative solutions across all manner of vertical industries. Access control, payments, digital identity, transport, and even emerging Digital Product Passport requirements for sustainability all stand to benefit from improved usability and security thanks to NFC.”

The findings of the study will be presented in a joint public webinar by ABI Research and NFC Forum taking place 16th April 2024.