Whether it’s the government sector, banking, transportation or even retail, security is the name of the game. As technology evolves, so too do security threats like identity theft and fraud, and organizations as well as individuals are more aware than ever of the need to protect their personal information.
Enter, smart cards. These cards are mainly used for identification, authentication, data storage, and application processing, with the contactless variety using RF technology to transfer information.
In general, cards embedded with just a magnetic strip only store information about end-users’ accounts. However, since contactless smart cards require a pin, this makes them more difficult to tamper with and provides better identification security for end users.
These security benefits are a major reason that the Global Contactless Smartcard Market is growing at a CAGR of 33.5 percent from 2013-2018.
TechNavio analysts have broken down this growing market and identified a few trends that are contributing to this impressive growth:
- Increased Adoption of NFC Payments
- Availability of Hybrid Smart Cards
- Use of E-passports
- Adoption of Smart Cards in Developing Countries
Increased Adoption of NFC Payments
Contactless payments and ticketing using NFC-enabled devices allow secure transactions via a chip embedded in mobile devices that helps store payment information. While making mobile contactless payments, NFC-enabled mobile devices operate in a card emulation mode that appears as a traditional contactless smart card to an external reader. The increase in the adoption of NFC-based payments is thus supporting the growth of the Global Contactless Smart Cards market.
Availability of Hybrid Smart Cards
Quite simply, hybrid smart cards combine contactless and contact interfaces on a single card.. The availability of hybrid cards is expected to increase the adoption of banking and payment smart cards, thereby boosting the overall market.
Use of E-passports
The threat of terrorism, increased cross border travel and the related airport security crackdown has created a demand for reliable, secure authentication and identification at the check-in counter. E-passports are one solution, as they are embedded with contactless smart cards that generate a unique code to identify an individual. These codes are difficult to imitate, making e-passports more reliable than traditional paper booklets.
Adoption of Smart Cards in Developing Countries
More and more government agencies in developing countries are now adopting contactless smart cards for a range of applications. For instance, smart card-based ration cards, drivers licenses, vehicle documentation, and so on, are being widely used in India. In addition, voter ID smart cards are increasingly being launched in South Africa. Likewise, many developing countries are using contactless smart cards in the government sector, which will inevitably contribute to market growth over the forecast period.
For more insights, view our Global Contactless Smart Cards Market 2014-2018 report.
