JP Buntix of The Merkle has compiled a short list of the top five wearables supporting contactless payments. These include Disney’s MagicBand, the Jawbone UP4, the Ring of Things, BPay Jacket and Visa’s sunglasses.
The MagicBand, says Buntix, can also be used as an authentication method to enter Disney parks and unlock hotel rooms, while the Ring of Things uses the PayEnable platform to allow consumers to fund their device with traditional payment methods.
Designed by Barclaycard and Lyle & Scott, the bPay has a contactless payment chip embedded in the jacket’s right sleeve and supports payments of up to 30 GBP. Meanwhile, the Visa sunglasses are part of a new pilot program to test contactless payment-enabled wearables on a large scale.
According to BusinessInsider, the sunglasses could be an indicator of where payments are headed.
“Visa noted that the sunglasses fit into the firm’s mission of ‘everywhere you want to be,’” BusinessInsider analysts explained.
“That’s important, because customers are interested in these types of payments — despite limited market availability, in 2015, 19% of consumers were ‘very interested’ in connected device payments. By embedding payments into everyday devices, the firm could reduce friction and make it easier for consumers to adjust to nontraditional payment mechanisms.”
BusinessInsider analysts also noted that users are testing and experimenting with wearable payments when available. In fact, a proprietary line of wearables from UK issuer Barclaycard saw £6.6 million ($8.2 million) in transactions between July and February, with Tractica expecting wearable volume to grow up to $501 billion by 2020.
Although wearable payments are considered an early niche market, gradual growth is projected as the industry works through multiple issues, including upgrading point-of-sale (POS) terminal infrastructure, consumer comfort with wearables and refining the frictionless payment process.
Indeed, a Stratos poll of U.S. smartphone owners found that more than two-thirds of respondents would prefer to use a wearable device rather than a mobile phone to make in-store payments. Stratos also confirmed that mobile payments could increase the frequency of wearables usage, with half of respondents stating they would use a wearable device more if it could make in-store payments. Overall, four in 10 respondents said they would make in-store payments via wearables.
Meanwhile, Gartner is forecasting growth for wearables, largely due to Apple popularizing wearables as a lifestyle trend. Perhaps not surprisingly, smartwatches offer the greatest revenue potential amongst all wearables through 2019. Gartner also expects smartwatches to pose stronger appeal with consumers in the future as ownership of more multifunctional devices capable of tracking exercise increases. In addition, wristbands will offer emerging value propositions beyond fitness, including mobile payments, access, safety, wellness and health.
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