There has been a high level of buzz around wearable payments for years now, but the market hasn’t quite reached mainstream crossover, despite high-profile efforts like the Apple Watch. However, the digital trends that have been rapidly reshaping the payments industry may be set to give wearables a big boost in the near future.
Consumers’ ideas about how payments are made are starting to change, thanks to the emergence of mobile and multichannel payment platforms like Apple Pay, Samsung Pay, and Mastercard’s Masterpass. To many, it still seems a bit weird to use a phone to pay for things, but many others are starting to see that there’s no reason you can’t link a credit card to other devices beyond phones, so long as the right security mechanisms are in place. And those companies that work behind the scenes to provide such security are starting to place bets on wearables.
Safran Identity & Security, for example, recently concluded a three-month pilot testing wristband-based payments at a university in Medellin, Colombia, and says it’s planning further trials as it seeks to get its technology certified for mass deployments. And at the start of this month, Oberthur Technologies announced a partnership with UAE Exchange to help promote its FlyBuy MiniFOB, a miniature contactless payment card designed for integration into a range of wearable form factors.
The developments tie in well with a recent market forecast from Goode Intelligence, which predicted that while mobile devices will continue to lead the charge with respect to biometric authentication, wearable biometric authentication devices will pick up steam over the next few years and make up a growing proportion of the combined market, which will surpass a value of $6.2 billion by 2022. It now appears likely that payment applications will be a driving factor in that growth as wearables increasingly become not just fitness-tracking devices, but also FinTech.