Contactless payments providers have denied claims that uptake of the technology has slowed in the UK.
Researcher Datamonitor said the “much-hyped” contactless payments were “a long way off from becoming the norm” and that the economic downturn had delayed issuers other than Barclaycard from investing in the technology.
Gilles Ubaghs, financial analyst at Datamonitor, said: “Essentially, it is a catch-22 as many consumers aren’t interested in having a contactless payment card when there are still so few places to use it and retailers don’t want to install the technology as so few people have a card.”
Datamonitor did believe there were promising long-term signs for the technology, yet Ubaghs added: “It will be a good deal of time before we’re able to walk into any shop and buy a chocolate bar in the same way as London commuters tap their Oyster cards.”
But Mark Carpenter, of secure payment specialist The Logic Group, said: “As the country rises out of the recession, the business case for investment in the technology is strong. We could see the technology being widely used in around 18 months.”
Stuart Neal, head of UK payment acceptance at Barclaycard, said far from delaying the uptake of contactless, the recession had provided added impetus for retailers to be innovative and offer improved customer service. The technology could cut transaction times and increase average spend per customer.
Barclaycard has 25,000 contactless terminals live across the UK, while Visa expects the number of its contactless cards in circulation to rise from eight million to 12 million by the end of 2010.
Among convenience store operators, Spar is already planning to roll out contactless technology (Independent Retail News, 2 July) and “variety of independent convenience stores” have also installed the technology, said Visa.
The limit for contactless transactions was increased from £10 to £15 earlier this year.
