Convenient, Secure, and Faster NFC Technology Continues to Gain Popularity Worldwide
Near field communication (NFC) is one of the recent advancements in the short-range wireless connectivity technology that leverages existing interconnection and contactless identification technologies. Over the past couple of decades, as the NFC technology continued to evolve at a rapid pace, the demand for NFC chips witnessed a consistent growth due to which, the NFC chips market has exhibited a positive growth rate over the past few years– a trend that is expected to carry forward during the forecast period.
Some of the key sectors that are anticipated to be the most prominent end users of the NFC technology include automotive, air transport, public transport, retail, and medical. The stakeholders operating in the current NFC chips market are increasingly seeking collaboration opportunities with other players involved in the NFC chips market to gain a competitive edge in the current market landscape. The advent of special interest groups (SIGs) continues to drive the development of future-safe new innovative solutions linked with the NFC technology. The increasing demand for NFC chips for NFC payments is another factor that will bolster the growth of the global NFC chips market in the upcoming years.
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While advancements in the financial payments sector will open up new avenues for players operating in the current NFC chip market, the increasing adoption of NFC chips from medical equipment, cosmetic, and automotive sectors is projected to provide an impetus to market growth. At the back of these factors, along with consistent advancements in technology, the global NFC chips market is on course to surpass US$ 5.6 Bn by the end of 2030.
Cosmetic Products with NFC Tags Enter Market
Due to steady advancements in the NFC technology, the demand for NFC chips has witnessed a sizeable growth from a plethora of industrial sectors. Furthermore, with new developments, applications of NFC chips are expected to expand to other industrial domains. For instance, beauty and cosmetic products are one of the recent end users of the NFC technology. A number of manufacturers and other players involved in the personal care and beauty products is leaning toward the adoption of the NFC technology to gain a competitive edge due to which, the demand for NFC chips is on the rise. The increasing use of NFC tags, owing to size, flexibility, and other advantages is expected to provide a boost to the growth of the NFC chips market during the assessment period.
Advancements in finance and payments sphere have occurred at a brisk pace in recent years due to which, the mode of payment and payment methods have evolved considerably. The onset of technology has gradually led to the development of the cashless ecosystem due to the entry of mobile banking, Internet banking, and mobile wallet payments. NFC payments have garnered immense popularity in both developed as well as developing regions of the world due to enhanced payment experience and convenience. Apple Pay, Google Pay, LifeLock Wallet, MasterCard PayPass are some of the most popular NFC payment applications in various regions of the world. NFC payments are more secure, convenient, and faster in comparison with other payment alternatives due to which, the demand for NFC chips is on the rise.
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Healthcare Sector to Provide Lucrative Opportunities amid COVID-19
The advent of the novel COVID-19 pandemic is likely to have a sizeable influence on the overall growth of the global NFC chips market in 2024. While the demand for NFC chips from non-healthcare sectors is anticipated to remain modest in 2024 due to the ongoing COVID-19 crisis, healthcare and payment sectors are tipped to emerge as major end-use sectors of NFC chips during the pandemic. The increasing demand for contactless payment coupled with increasing need to improve the communication among the medical staff across hospitals is some of the major factors that are likely to boost the growth of the global NFC chips market during the assessment period.
Analysts’ Viewpoint
The global NFC chips market is expected to expand at a healthy CAGR of 7.5% during the forecast period. The market growth can be attributed to increasing demand for NFC chips from finance and payment sectors, advancements in the NFC technology, high demand for contactless payment due to the COVID-19 pandemic, rising adoption of NFC chips from the automotive sector, and entry of numerous special interest groups mainly in developed regions, including North America and Europe. Market players should focus on increasing their market presence by collaborating with other market players and exploring potential benefits of NFC chips in various industrial domains.
NFC Chips Market: Overview
- According to Transparency Market Research’s latest research report on the global NFC chips market for the historical period 2018–2019 and the forecast period 2024–2030, rise in demand for NFC chips among consumer electronics manufacturers and government initiatives and subsidies coupled with rising applications in various sectors are factors expected to boost the global NFC chips market during the forecast period
- In terms of revenue, the global NFC chips market is estimated to exceed a value of US$ 5.6 Bn by 2030, expanding at a CAGR of 7.5% during the forecast period
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Rise in Demand for NFC Chips from Manufacturers of Consumer Electronics: A Key Driver of NFC Chips Market
- NFC chips simplify user interfaces, which enhances their applicability in consumer products. Smartphone manufacturing companies, such as Apple and Samsung, install NFC chips in their handsets; consequently, the demand for NFC chips is increasing among mobile phone manufacturing companies.
- Apart from smartphones, consumer electronic goods, such as speakers, televisions, cameras, refrigerators, and washing machines, use NFC chips to boost contactless data transfer. Moreover, the adoption of digitalization and advanced connectivity technologies are propelling the demand for NFC chips.
- Automotive and infrastructure industries are key markets that are likely to expand at a rapid pace during the forecast period, due to rising integration of various connected technologies, and advance infotainment and security features. These factors are likely to indirectly impact the global NFC chips market, since all of these products are used with NFC chips.
- Communication through NFC chips is considered safest compared to other similar technologies, such as Bluetooth and Wi-Fi; thus, the penetration of NFC chips is increasing among security systems. In areas such as ticketing particularly, NFC chips are expected to help reduce the cost of issuing tickets and maintain the ticketing infrastructure, which has already been proven in mass transport and airline ticketing. Furthermore, NFC is based on existing contactless infrastructure that is already in daily use by millions of people around the world.
- At a more strategic level, NFC chips enable product and service providers to establish a new communication channel with their customers. When consumers elect to ask for further information or participate in a promotion by touching an NFC tag, they could be asked if they would like to participate in other information or promotional programs.
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