The electronic funds transfer-point of sale (EFT-POS) terminals market is expected to grow rapidly as vendors capitalise on opportunities in emerging markets such as China, India, Brazil and Mexico. The emergence of mobile POS (mPOS) payment-based solutions has provided added opportunities for vendors.
These developments will spur market revenue growth from $2.53 million in 2012 to $3.51 billion in 2017 at a compound annual growth rate (CAGR) of 6.6 percent, according to a recent study by Frost & Sullivan.
mPOS payment-based solutions have become a viable option for small enterprises and direct sellers owing to its cost-efficiency, security and easy-to-use features,” said Frost & Sullivan Global Program Director, ICT in Financial Services, Jean-Noël Georges. “This niche market is also the perfect entry point for new challengers to deploy their innovative payment systems based on a cost-effective business model.”
Market entrants will still face significant barriers especially in Western Europe and the United States, where the market is saturated. Moreover, challenging economic conditions have led to prolonged recession in some of the major markets for the POS industry — the United States, the Eurozone, and parts of Asia and Latin America, reducing the addressable market base for terminal vendors as even existing customers are wary of capital expenditure.
Another factor holding back robust growth is the lack of industry-wide security and payment processing standards. Despite the existence of the Europay, MasterCard and Visa as well as Payment Card Industry standards, several countries in Europe and Asia have set their own policies. While these new security requirements play a key role in combating fraud, they have an adverse impact on a vendor’s time to market.
“To capitalise on this potential, global EFT-POS providers must enhance and personalize customer experience,” noted Georges. “Apart from extending services such as money transfer, bill payment, age verification, mobile top-up and couponing, offering loyalty programs and gift card applications will open up additional avenues for revenue generation.”
Frost & Sullivan