Dubai residents in the United Arab Emirates (UAE) have an appetite for using contactless technologies on banking cards and mobile phones, using Near Field Communication (NFC) technology, claims a survey from the security and trusted service manager (TSM) Gemalto, with 80% of respondents saying they’d either ‘like’ or ‘love’ the opportunity to use the technology on a regular basis.
A large majority of Dubai respondents (87%) also view contactless NFC payments as a way to streamline everyday activities by shortening waiting queues at the tills when shopping or commuting. The possibility of multi-application cards, or eventually smartphone apps, which support both payment and contactless transit ticketing in a single device - doing away with the need to carry numerous different cards for everyday activities - was especially popular among the young, with the18-24 year old age group almost universal in their approval.
The survey was conducted at the end of 2012 by Salience Research on behalf of Gemalto via face-to-face interviews with a supposedly representative small sample of Dubai residents aged from 18-55 and has only now been released.
The TSM vendor, which has been deeply involved in the large-scale NFC pilot and rollout schemes in Nice, France, claims that the survey findings should be of interest for UAE banks, particularly as youngsters’ enthusiasm for contactless technology can be used as a way to draw them towards opening a retail bank account.
Reaction and News Analysis
Commenting on the survey results, Eric Claudel, senior vice president of telecommunication at Gemalto Middle East, said: “The feedback suggests that the momentum behind contactless payment technologies in the Middle East is reaching a tipping point, and it is no longer an ‘if’, but rather ‘when’, it will become a part of everyday life. Historically, the region has retained a strong attachment to cash: over 75% of transactions are completed in this way. With separate ABI research forecasting that 85% of payment terminals will be contactless-ready by 2016, soon the gentle tap of a phone or card will increasingly provide a truly compelling alternative for consumers over their long-held attachment to notes and coins.”
It’s an argument that has been made many times before in debates about the ‘death of cash’, of course, but notes and coins have been with us since the emergence of civilisation and they are not going away anytime soon. Practically everyone in the UK, for instance, now has a contactless-enabled card but usage numbers - as opposed to technology ‘uptake’ numbers via bank-issued cards - is still low.
A striking aspect of the Salience Research/Gemalto-sponsored survey in Dubai, UAE, is that 5% more people would be keen to use NFC contactless technology if it was deployed on a mobile phone, rather than a card. Traditionally, this differential figure is often higher as consumers are keen to consolidate payments on one device and the mobile is now central to many people’s lives with the thought of leaving the house without it anathema to many. Nevertheless mobile NFC is still more popular than its card equivalent in Dubai and the ability to link it to a mobile wallet and collect loyalty points and so forth was cited by some as an attraction.
Other top attractions of mobile NFC payments to survey respondents were the ability to access electronic e-ticketing, the aforementioned transport uses, and mobile NFC-based identity and access badge apps for use in the work place or as external verification.
According to Gemalto only 5% cited concerns over security as an obstacle to using contactless payments. People are also getting more aware of the technology, with only 16% of respondents saying they had never heard of it before. The numerous pilots and deployments of NFC-enabled mobile and contactless cards around the world seem to have contributed towards educating the market.
• To find out more about the mobile FS space read the bobsguide MWC 2013 show report and our bobsguide blogger covering mobile financial services, Sirpa Nordlund, executive director of the bank-led Mobey Forum.