As part of our alternative payment trends series we look at wearable payment devices and see how you can keep a competitive edge, delivering the propositions your customers are looking for
Alternative payments methods
Some alternative payment methods (APMs) or alternative methods of payment (AMOPs) are essentially another way of paying apart from using cash. Cash, usage in some regions continues to drop, for example in Sweden as they journey towards a cashless society.
And although differing methods have existed for some time – credit and debit cards for example, which are said to have been introduced in the 50s and 60s respectively, we’re reaching an exciting new dawn in payment trends, with the global pandemic being the catalyst. There were 13.1bn contactless payments in 2021, equivalent to 415 transactions every second.
Digital-first behaviours originated or compounded during the pandemic have led to an increased use of online banking and a shift towards contactless payments.
Contactless payments have increased 36% vs 2020. They’ve seen an even bigger increase of 52% compared to pre-pandemic levels in 2019.
This increase in contactless payments for convenience, safety and because people have changed behaviours and not phased back, has opened the door for more opportunity in this arena.
Here we look at wearables as part of our alternative payment trends series and see how you can keep ahead of the curve delivering your customers the propositions they need.
Wearables – the next trend in payments
Wearable payment devices are payment appliances that can be adorned on the person and it’s likely we’re all familiar with them. From smart watches to payment rings, to bracelets and sunglasses, they provide an alternative way to pay other than a physical card. not to be confused with the colloquial term ‘wearables’ - the umbrella term for wearable technology.
The wearable payment devices market is predicted to grow at a CAGR of 29% during 2022-2032, with an estimated market valuation of US$ 13.43 billion in 2022. That’s an incredibly valuable area to be a part of.
Why now for wearable payments?
One school of thought is that the advancement of technology, coupled with an increase in customer desire for convenience and contactless payments following the pandemic, means this is a golden time for wearable payments devices.
It’s not just the UK, that’s seeing an increased use of general wearables - the global wearables market hit a new peak in Q4 as shipments reached 171 million units, up 10.8% from the same quarter in 2020, according to IDC.
Number of connected wearable devices worldwide by region in 2021
Asia Pacific 258.2
Central and Eastern Europe 55.6
Latin America 39
Middle East and Africa 37.5
North America 378.8
Western Europe 159.7
Can GPS help my business deliver wearable payment solutions?
Yes, we have the technological capability and the expert knowledge in this arena, as we’ve helped several other companies on their journeys too.
Our GPS Apex issuer processing platform enables our clients to provide their customers with the latest payment experiences, including Apple Pay, Google Pay, Samsung Pay and Fitbit Pay. By utilising our software development kits (SDKs), you can bring your own Host Card Emulation (HCE) mobile wallet to market, ladened with customer-friendly features which have been created to help deliver outstanding customer experiences and take card management capabilities to the next level.
We know what it takes for companies to grow in this arena too. GPS customers like McLEAR and Payme Swiss deliver wearables.
McLEAR describe themselves as ‘The original contactless payment ring’. Their customers can make payments by tapping a ring on a contactless payment device. If it’s got the contactless symbol, they’ll be able to pay anywhere in the world with and GPS helping to facilitate this payment. You can even transfer funds between your rings.
Payme Swiss, who provide unique and innovative payment solutions in the EEA market explain they're the first programme manager to offer unique payment wearables (without battery) certified by Mastercard. Plus, in collaboration with Rosan Diamond they’re the only program manager worldwide that can create unique and bespoke jewellery payment devices.
Is setting up virtual payment capabilities a complicated process?
Working with the right partner who has the experience guiding and advising virtual payments customers, teamed with cutting-edge payments processing technology knowledge, and in-house experts are the key variables that can make the difference.
Our GPS Apex™ is a powerful and feature-rich payments processing platform that enables you to launch innovative, secure and scalable payment products like bespoke virtual card configurations and rules, or mobile virtual wallet solutions with in-app provisioning and a real-time feed. Whomever you choose to partner with, ensure they have the expertise to help you and your business from start-up to global scale-up.
Want to read more?
Sweden’s journey to a cashless society Along standing innovator when it comes to finance and currency, Sweden is leading the way to cashless adoption, with reports predicting it will be fully digital by March 2023.