The content of this report will be updated with the latest scenarios based on the global COVID-19 Pandemic
The smart card market is expected to register a CAGR of 8% over the forecast period (2020 - 2025). In the past decade, the information age has witnessed an array of security and privacy issues that have called for advanced smart card security applications. In addition to this, the advent of multifunction cards has allowed managing network system access and store value and other data.
- Further, smart cards are safeguarding the private information of individuals and keeping their informational details safe from hacking and other unwanted intrusions.
- The adoption of microprocessors incorporated cards, particularly in BFSI (EMV) and mobile phone devices (SIM cards), has led to falling costs through economies of scale. Furthermore, this has led to microprocessor cards becoming a lucrative option for innovators in the emerging markets, such as access control, E-passport, PKI, and multi-applications where their cryptographic capabilities address the issues of security.
- The growing need for convenience and security regarding transactions has made the adoption of smart cards highly relevant. It is gaining more prominence over other machine-readable cards, as the former requires a much lower cost of maintenance.
- In January 2018, Gemalto was chosen by Bank of Cyprus to supply the world’s first EMV biometric dual interface payment card for both chip and contactless payments. The card will use fingerprint recognition instead of a PIN code to authenticate the cardholder. As the company is aiming a wider roll-out across Europe in the coming months, it is poised to drive the demand for smart cards.
Scope of the Report
A smart card is a pocket-sized card, made of plastic, and embedded with integrated circuits, also known as microchips. They are used for security purposes like authentication, identification, data storage, and application processing. Smart Cards are widely used in sectors such as BFSI, Government, Transportation,and Healthcare. They can be broadly classified into two types: contact-based and contactless. Contactless smart cards are used by employing radio frequency between cards and a reader, that requires no physical insertion. Hence, contactless smart cards have faster applications and are much more user-friendly than contact-based smart cards
Key Market Trends
Extensive Use in Travel Identity and Transportation is Expected to Drive the Market
- The portability, ?exibility, and convenience of having just one smart card that could hold a range of tickets, other transport products, and third-party services (such as local authority ’city-card’ applications or some private-sector applications) have led to the city-based transport sectors across countries actively embracing the technology over the past few years.
- For instance, the State of Delhi in India in 2018 launched the common mobility smart card scheme for over 200 DTC and cluster buses, making the city the first in the country to have introduced such a facility.
- Around November 2018, it was announced that starting 2019, New York’s Metropolitan Transit Authority will allow the riders to tap their credit or debit card at turnstiles to make payment. In line with this, the country’s largest banks, including American Express and Capital One made the transition to contactless cards that will work with these new systems. This transition made Visa predict a total of 100 million of its cards in the United States to be converted to contactless by the end of 2019.
- Similarly, with the increasing number of subway trains in China, the market for smart cards is expected to witness significant growth.
Asia-Pacific to be the Fastest Growing Market during the Forecast Period
- The smart card market in Asia-Pacific is expected to witness significant growth in the forecast period owing to the increasing demand in developing countries such as India, China, Malaysia, and Thailand, which are integrating smart cards in the transportation, BFSI, retail, government, and healthcare sectors.
- Companies in line with government initiatives in these countries are implementing smart cards to make the process of payments and documentation easy for consumers. Singapore is fast coming as a hub for contactless payments in APAC. Smart Card transactions account for more than half of all card-based transactions in Singapore.
- Government initiatives in countries of this region are expected to act as the major drivers for the smart card demand. For instance, in 2018, Venezuela partnered with the Chinese telecom giant ZTE to build a system that monitors the citizens’ behavior through a new identification card. ZTE executives exhibited the Venezuelan smart cards embedded with radio-frequency identification, or RFID.
- Further, China’s ID cards feature an embedded chip and digital encryption. The card contains personal information, including the individual’s full name in the Chinese characters, gender, ethnicity, date of birth, domicile, identification number, and a color photo.
The smart card market is fragmented. Some of the major players are using tactics such as partnerships, new product launches, agreements, expansions, innovations, joint ventures acquisitions, and other strategies to increase their footprints in this market. Besides, many other players are looking to expand their production capacity, especially in Asia-Pacific, which is the fastest growing smart card market. In the emerging economies, companies are focussing on launching new smart card products for government and transportation applications. Some of the recent developments are as follow:-
- May 2019 - IDEX Biometrics ASA, the leading provider of advanced fingerprint identification and authentication solutions, announced a partnership with Sian Intelligent Technology Co, Ltd., a leading Chinese smart card manufacturer, specialising in the development, design, manufacturing and sale of dual-interface smart cards, to accelerate volume production of biometric smart cards.
- March 2019 - In line with the government’s vision of one nation one card, Ridlr, a subsidiary company of Ola, India’s leading mobility platform and one of the world’s largest ride-hailing companies, recently partnered with the NMMT (Navi Mumbai Metropolitan Transport) and HDFC Bank to launch “Navi Card” – a RuPay National Common Mobility Card that will enable travelers in Mumbai to enjoy cashless commute in NMMT buses.
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