The alarming increase in payment fraud worldwide has led to renewed interest in establishing security standards that include end-to-end encryption of data and compliance with directions from the major card issuers. The switch toward Europay, MasterCard, and Visa (EMV) and payment card industry-pin entry device (PCI-PED) has upped terminal sales growth, particularly in Europe, Asia Pacific, and Latin America.
New analysis from Frost & Sullivan (kiosks.frost.com), World EFT POS Terminals Market, finds that the market earned revenues of over $2 billion in 2008, and estimates this to exceed $3.4 billion in 2014.
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"The EMV guidelines require all magnetic stripe cards be replaced by chip-based ones as per the deadlines set for each geographic region, failing which the liability of fraud would shift from card issuers to banks and financial institutions," says Frost & Sullivan Industry Analyst Aravindh Vanchesan. "As a result, legacy terminals that are incapable of handling smart cards are being replaced by newer systems on a large scale in countries such as the UK, France, Brazil, China etc."
Vendors in this domain are continuing to innovate and offer greater functionality at the point of sale, encouraging retailers to upgrade their legacy systems.
The current economic crisis, which started in late 2007, has resulted in prolonged recession in some of the major POS markets in the United States, Western Europe, and parts of Asia and Latin America. As the eventual recovery cycle is unpredictable, all participants in the POS industry will continue to be negatively affected by the disruption in credit markets and macro-economies in the short term.
Global credit markets have also been affected by declining consumer confidence and spending worldwide. Hundreds of retail chains and several high-profile financial institutions have filed for bankruptcy in recent times. Many promising projects have been either shelved or delayed due to the lack of access to credit or capital. Apart from lower sales volumes, the steep discounts offered by manufacturers to tide through this crisis erode profit margins further.
With growing awareness on the latest technologies and multi-application capabilities of the new generation of terminals, the focus on price is expected to diminish and result in significant investments.
"Merchants need to take advantage of the new state-of-the-art payment terminals that go beyond the basic secure credit/debit functions by enhancing the customer experience and generating new revenue streams," says Aravindh. "Vendors should be pushing it as the key value proposition – transforming the payment terminal into a customer relationship management (CRM) device that is critical to the merchant's business."
At present, EFT terminals are capable of running a range of concurrent applications such as money transfer, bill payment, age verification, mobile top-up, couponing, and so on. Loyalty programs and gift cards applications are the most popular worldwide. This allows merchants to identify the profiles of potential customers and segment them according to their lifestyle and buying behavior. Moreover, it also enhances the overall shopping experience for consumers.
World EFT POS Terminals Market is part of the Kiosks & Retail Systems Growth Partnership Services program, which also includes research in the following markets: Payment Systems in the Petroleum Market, World Self-Checkout Systems Market, World ATM Market, World Retail Software Market, and World Retail Printers Market. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.
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World EFT POS Terminals Market / N6BD