Rise of the payment ring – how wearables are changing payments
When a select group of Olympic hopefuls packed their bags for the recent Rio Olympics, they had a little extra equipment to take along. Visa, the payments provider at the Olympic and Paralympic Games, had provided each member of Team Visa, a group of 45 Olympians, with an NFC-enabled Visa payment ring. This initiative allowed athletes to simply tap their ring on an NFC-capable payment terminal when purchasing something at the Games. The ring was water resistant and battery free, so athletes didn’t have to charge their new smart accessory; meaning they could go from the swimming pool to the shops without any hassle.
While this may have been a promotional endeavour for Visa, they have made a similar product available to the general public. This trend does indicate that wearable NFC payment technologies are set to have a sizable impact on the payments space and on retail in general.
Researchers predict that this type of smart payments ecosystem could be a reality in less than a decade. Soon we won’t have to whip out our wallets to pay for goods or services. Chances are that you won’t need to carry a wallet at all. In just two years, wearable payments are expected to hit $95bn, up from less than $35 billion in 2015, according to Juniper Research predictions.
Will you be paying for that by cash, card or sunglasses?
Currently, the wearable devices that we attach to our bodies and use to pay for retail offerings are pretty limited to smartwatches and fitness trackers, such as the Apple Watch, Samsung Gear S2 smartwatch and Jawbone UP4. All of which are linked to specific payment systems or cards.
Much like Visa did with their NFC Olympic payment ring, other credit card companies have also noticed that plastic may be on its way out and are coming up with innovative ways to adapt.
MasterCard has been particularly active. At the end of 2015, MasterCard debuted a new programme aimed at turning any item – be it clothing or a keychain – into a secure form of payment. So far, their efforts to connect commerce to any internet-enabled device have seen them partnering with automotive manufacturers, jewellery designers and fashion houses. One way they’ve already brought their ubiquitous payment innovations to life is through their Groceries by MasterCard initiative, in partnership with Samsung. The concept allows consumers to order their groceries from the latest line of smart Samsung refrigerators using a specialised grocery shopping app.
Other innovative payment technologies include Barclays’ bPay, which builds NFC-devices into everything from jackets and wristbands to keychains and stickers, transforming almost any item into a payment tool. And Visa isn’t the only one developing payment accessories. A London-based start-up has also created a smart ring. The Kerv is a battery-free, waterproof contactless device that allows the wearer to pay for items or transfer information all with a simple tap.
A man walks into a coffee shop, snaps a picture of a barcode using his smartphone and walks out with a yummy caffeinated beverage. A woman walks into a bar, scans her payment ring and receives a glass of Chardonnay. The wearable payments movement is here. How are you responding to these changes? Paycorp can help. Visit our website to find out more about what we do.