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Mobile Payments

Wearable payments expected to grow to USD 501 bln by 2020 - MasterCard

Wednesday 24 February 2016 | 11:02 AM CET

The volume of wearable payment transactions is expected to grow to USD 501 billion by 2020, as consumers believe that wearables will shift from single-use to multi-purpose products, according to MasterCard.

In its fourth annual MasterCard Mobile Payments Study, conducted by Prime Research, MasterCard tracked 2 million global social media posts about mobile payments across Twitter, Facebook, Instagram, Forums, Google+, and YouTube. According to MasterCard, cardholders are asking banks and retailers to provide real-life, ready-to-use mobile payments options.

As more choices are made available to them, the conversation has evolved and consumers seem to be fully embracing the next generation of payments, MasterCard said.

Recently, MasterCard has announced a partnership with internet security company WiseKey at the Mobile World Congress (MWC) in Barcelona.

The partnership will enable contactless payments on luxury brand watches and wearables, with WiseKey currently working with watch manufacturers including Hublot and Bulgari.

Also, WiseKey brings the MasterCard another step closer to converting every device into a payment device, after announcing a partnership with consumer ecommerce player Coin to enable payments via smartwatches, fitness bands, and other wearable devices.

Currently, fitness tracker manufacturer Atlas Wearables, wrist-worn fitness coach maker Moov, and smartwatch creator Omate are working with both MasterCard and Coin to make selected devices payment-capable. 

Expanding on its partnership with Coin, MasterCard also announced a developer program at MWC for accelerating the integration of payments into wearables.

The program will enable access to the MasterCard Digital Enablement Service (MDES) to digitise MasterCard payment credentials. Approved developers will have access to Coin's proprietary technology for enabling payments, and later in 2016, to digitised MasterCard credentials through Coin's integration with MDES.

With plans for rollout by the end of 2016, MasterCard has also showcased its Digital Enablement for Merchants, a tokenisation and digitisation solution for ecommerce merchants that uses a token and a transaction-specific cryptogram. MasterCard said the service helps merchants minimise fraudulent transactions and associated costs, and has the potential to improve approval rates as well as drive more transactions through merchant checkouts.

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