V. Gopalakrishnan, regional director MEA of Matica Technologies, outlines why payment cards are ‘here to stay’
Published in Technical Review Middle East – Thursday, 26 May 2016
There is a trend to compare the use of debit and credit cards in relation to the newcomer: ‘mobile payment’ – or mobile money, as though cards are likely to go out of fashion.
And while Middle East consumers are known for their mobile payments, this simply isn’t true. So without rejecting out of hand the future potential of mobile payments, let’s examine some clear-cut facts about cards so no-one is in any doubt: cards are here to stay.
Between 2015 and 2017 it is estimated that 50bn cards will be produced for the global financial industry – this includes 22bn EMV cards, the standard for smart payment cards, often referred to as ‘chip and pin cards’. (EMV stands for Europay®, MasterCard® and Visa®.) In 2015, the EMV global market grew by about 30 per cent alone.
More generally, the Middle East and Africa is the third largest growth region in the world with an expected production of 2.75bn financial cards in 2016 – which equates to 9.2 per cent growth. Asia Pacific tops the rate with over 10bn this year (11.3 per cent) followed by the Americas with 2.7bn (7.4 per cent).
The global contactless smart card market is also experiencing substantial growth as more point of sale technology is updated to accommodate the fastest form of card payment. Industry forecasts a global growth of 30 per cent over the next five years. Some 900mn contactless cards were issued in 2014.
In the Middle East, where online shopping is especially popular despite 40 per cent being concerned about its security, (72 per cent of the region’s consumers made their first online purchase between 2013-2015), 53 per cent prefer in-store shopping so they can “see, touch and try” products*. However, even in our region where many still use cash, card payments are undoubtedly still growing.
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