“Vendors predict they will ship only about 25 million contactless cards or fobs this year. That’s up modestly from the roughly 20 million contactless cards or tokens vendors sold in 2006.”
“The 25 million contactless cards and fobs likely to be issued this year compares with the roughly 300 million credit, debit and prepaid cards U.S. financial institutions will roll out in 2007, nearly all of them simple magnetic-stripe cards.”
“Of the largest banks, only JPMorgan Chase has begun a significant rollout, although it has only put contactless chips on part of its portfolio.”
Major scheme initiatives like contactless and mobile payments will fail without active merchant participation. This has been evident to many of us for a long time, but now the realization is starting to go mainstream.
“A major obstacle is persuading more merchants to accept contactless.”
“There are 6 million places where you can use your credit card, 45,000 (contactless acceptance locations) doesn’t excite me.” (John Suchanec, senior vice president of payment technology for Bank of America)
“Until you have a better merchant coverage, there’s clearly a problem. It’s coming along. We would just like to see it come at a faster pace.” (Leigh Malnati, vice president for contactless payments at American Express)
“With rules adopted by the payment card organizations allowing U.S. consumers to make low-value purchases without signing receipts, tapping cards or other tokens to pay is not appreciably faster or more convenient than swiping the cards at the point of sale.” (John Suchanec, senior vice president of payment technology for Bank of America)
Visa has already agreed to lower interchange in the UK to encourage merchant acceptance, and the same might happen in the US. Here are a few prior posts on other ways to encourage acceptance, based on providing more value to merchants through new payment features now available thanks to chip technology like contactless and EMV:
Report: Banks Should Mine Data Troves to Build Merchant Loyalty
How contactless payment brands (PayPass, Visa Wave, ExpressPay) can be much more attractive to merchants
How US banks can use contactless to compete more effectively against alternative payment provider Pay By Touch
Cool payment technology that makes contactless much more attractive for merchants
Blueprint for launching new cash replacement products like contactless
What is much more important than speed at the checkout?