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Contactless Cards

TABLE OF CONTENTS

Section

Executive Summary  

  Challenges of Alternative Payments Innovation

  Electronic Payments

  Focus of Report

  Technology

  Competition, Cooperation, Partnerships

  Conclusion  

  

Overview of Alternative Payments

  Overview of Alternative Payments

    Scope of this Report

  The Way People Pay

    Three Ways of Paying

    on Account and Extending Credit

  The Payments Value Chain

    Potential to Shorten the Value Chain

  The Four Party Payment System

    Authorization

    Clearing and Settlement

  Interchange Fees

  Types of Alternative Payments

    Contactless Payments (Debit And Credit)

    Mobile Payments

    Biometric Payments

    Specialized Payment Markets

      Micropayments

      Social Money

  Key Market Segments

    Mainstream Market

    Unbanked, Immigrants, and Credit Challenged

    Unbanked -- International

    Youth Market

    Merchants

  Conclusion

Figures:

       Overview of Alternative Payments - How A Purchase Is Made

       Overview of Alternative Payments - How A Merchant Gets Paid

Tables

       Annual Number of Noncash Payments

  

Alternative Payments Technology  

  Introduction

  Magnetic Stripe

  Radio Frequency Identification (RFID)

    RFID Acceptance

  Smart Cards

  Short Message Service (SMS)

    Direct Debit Using SMS

  Near Field Communications (NFC)

    NFC Trials

    Philips Arena Trial in Atlanta, Georgia

    NFC Trial in Dallas, Texas

    NFC Potential

    NFC Developments in Japan

    NFC In Europe

  Biometrics

    Fingerprint Template and Payment Procedure

  Industry Coordination and Standards

    RFID

    m-Payments and Contactless Payments

    NFC Forum

  Payments: Mag-Stripe, Contactless, Smart Card, Wireless, Biometrics

  Conclusion

  

Market Drivers and Trends  

  Introduction

  Speed and Convenience

  Country Specific/Cultural Factors

  Differing Payments Infrastructures By Country

  Ease of Use, Fumble Factor

  Micropayments

  Microcomputer in the Hand

  Cool Factor

  Retaining Customer Loyalty -- Rebates and Coupons

  Payment/Cardholder Steering

  Unbanked Population (Immigrants, Credit Challenged)

  High Credit Card Fees -- Background on PIN-Based Debit Cards

  Disintermediaton

  Security Concerns

  Active versus Relatively Passive Payment Action

  Government Support and Regulation

  Need for Online Payments, New Payment Alternatives

    PayPal

    Google Checkout

  Un-Drivers

  Point of Sale Equipment

  Other Payment Providers

    MoneyGram International

    Peppercoin

  

Contactless Payments  

  Introduction

  Background and History -- United States

    Japan and Korea, Europe

  Strategic Factors Affecting Contactless Usage and Deployment

  Interchange Costs

  Additional Benefits of Contactless Cards

  Security of Contactless Cards

  Cross-Elasticity with PIN-Based Debit Cards

  Background on PIN-Based Debit Cards

  Applications

    Big City Mass Transit

    Case Studies -- 7-Eleven and Sheetz

    Employee Cafeterias

    Vending Machines

    Market Promotions

  Incentive for Customer and Merchant Use

  Contactless Market Opportunity

  Lessons from Target’s Bad Experience with Smart Cards

  Terminal Upgrades to Contactless

  Key Players

    Credit Card Companies and Payment Services

      American Express

      Citibank

      Discover Financial Services

      MasterCard Worldwide (PayPass)

      Visa

      First Data

    Reader Systems and Equipment Companies

      On Track Innovations Ltd. (OTI)

      Symbol Technologies

      ViVOtech

    General Technology Providers

      Giesecke & Devrient GmbH

      INSIDE Contactless

    Other Contactless Payment Players

      Chockstone (Customer Loyalty Solutions)

      FreedomPay (Corporate Cafeteria Market)

      Precision Dynamics (Alternative Contactless Payment Provider)

      Texas Instruments (RFID Chips)

      Oberthur Card Systems (Contactless Cards)

  

Market Projections  

  Introduction

  Contactless Payments

    Current Market

    Key Assumptions

    Market Forecast

Figures

       Contactless Payment Revenues at U.S. Merchants - 2006 to 2011

       Contactless Payments at U.S. Merchants Percent of Credit and Debit Card Dollar Volume - 2006  to 2011

       Contactless Payments at U.S. Merchants Percent of Credit and Debit Card Transactions - 2006 to 2011

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