Report Overview

Growing popularity of contactless payments among the young population in the region, increasing demand for host card emulation (HCE) and NFC technology, rise in disposable income could boost the expansion of GCC Wearable Payments Market at a robust growth rate during the forecast period between 2023 and 2029.

GCC Wearable Payments Market - Industry Trends & Forecast Report, 2029

GCC wearable payments market size was estimated at USD 54.84 billion in 2022. During the forecast period between 2023 and 2029, the size of GCC wearable payments market is projected to grow at a CAGR of 26.50% reaching a value of USD 89.72 billion by 2029. The major driving factors for the market growth are the increasing use of contactless cards and wearable devices due to COVID-19 situation, emerging demand for contactless payment for secure and safer payment transactions, and the increasing use of NFC technology all driving the growth of the wearable payment device market. Wearable devices like watches, wristbands, and smart rings have grown in popularity in recent years. They can detect, analyze, and transmit data about the body's vital signs. They are IoT-enabled devices that actively exchange data with the operator, manufacturer, and other connected devices. These devices can also make contactless payments. Since the beginning of the COVID-19 pandemic, people have been wary of using physical cards for payment at retail outlets due to the risk of infection. Contactless payment via wearable technology and smartphones is people's first choice for making safer transactions.

GCC Wearable Payments Market - Overview

Anything that can be fastened to the body and used to accept payments of any kind is wearable. The two most popular wearables are smartwatches and fitness trackers. Through services like Apple Pay and Samsung Pay, they link a device to a user's bank account. By the end of 2020, the total value of wearable payment transactions is expected to reach $500 billion. We are moving toward a more connected existence due to devices like smartwatches, virtual reality and augmented reality technology, smart jackets, and a wide range of other gadgets. Wearable technology in the context of healthcare refers to electronic gadgets that people can wear, such as Fitbits and smartwatches, and which are made to gather information about their activity and health. One of these industries is healthcare.

Growth Drivers

Growing preference for contactless payments

Because of hygiene concerns during COVID-19, there is a growing preference for contactless payment methods. Wearable payment refers to payment transactions conducted via wearable devices that are integrated with wireless technologies such as NFC and RFID. Wearable payment devices not only provide customers with a convenient and contactless payment method, but they also ensure safety and hygiene. Especially since the COVID-19 outbreak. Customers prefer cashless transactions for hygiene reasons due to the spread of COVID-19. For example, Mastercard estimated a 40% increase in contactless payments in the first quarter of 2020. As a result, several financial institutions, banks, and payment service providers have begun to accept the digital payment agenda; however, to ensure customer satisfaction, these payment devices must be equipped with stronger security measures.

Growing need for HCE

GCC wearable payments market is expected to grow at a significant rate due to an increased demand from end-use industries for Wearable Payments, Host Card Emulation (HCE), and the growing acceptance of digital payments. HCE enables mobile or wearable devices to imitate cards on NFC-enabled devices without requiring access to an authenticated feature.

Deepening NFC penetration

Many e-banking sites use wearable payments systems. These e-banking platforms are built to use NFC technology in their transactions, allowing for seamless payments. Furthermore, cost savings associated with the implementation of NFC technology boost technological demand. This technology is widely used in businesses to transfer data from computers to contactless payment terminals such as NFC tags and smartphones.

Restraints

Battery draining issues in wearable devices

It is critical to recharge the device regularly to ensure its smooth operation; if the device becomes discharged, it immediately disconnects the user. This may result in insufficient data or a missing data cluster, affecting the payment process. Wearable payment devices are becoming smaller than ever due to improved technologies and form factors, necessitating the use of small-sized batteries to power payment functionality. Furthermore, when a wearable device is powered by advanced operating systems, a large battery backup is required to ensure continuous performance. The direct connectivity of the cellular network, on the other hand, can quickly drain the battery of wearable devices. It could harm battery life.

Impact of COVID-19 on GCC Wearable Payments Market

Throughout the forecast period, COVID-19 pandemic’s positive impact on the GCC wearable payments market is expected to continue. Customers began preferring contactless payments method during the pandemic, which is expected to accelerate the adoption of wearable payment devices. But the market's expansion is anticipated to be hampered by factors, such as the devices' short battery lives, high cost, and security issues. Limited production results from manufacturers' inability to introduce their products into the market due to the high costs of devices. Due to their high price, these payment devices are out of reach for many consumers. Additionally, the market's increased competition and low product awareness are inhibiting market expansion.

GCC Wearable Payments Market

Segmental Coverage

GCC Wearable Payments Market - By Technology Type

GCC wearable payments market is divided into Barcode, Contactless Point of Sale (POS), Near-field Communication Technology (NFC), and Radio Frequency Identification (RFID) segments. The barcodes segment dominates the market. Retailers are putting more effort into reducing friction at the register and enhancing the overall shopping experience. The barcodes on wearable payment devices are read by barcode scanners that use scan-and-go technology. Customers can easily scan their items as they shop due to this technology. Retailers are also able to do away with the need for a conventional, static point-of-sale due to the barcode system.

GCC Wearable Payments Market - By Device Type

On basis of device type, GCC wearable payments market is divided into Smart Rings, Fitness Tracker, Smart Watches, Fitness Wristbands, and other segments. The fitness tracker market holds the highest market share. Due to the growing popularity of various fitness devices and the rising number of fitness enthusiasts across the GCC, fitness trackers are predicted to gain traction. Mobile payments are now being incorporated by numerous vendors into their fitness trackers. Customers are also choosing fitness trackers in large numbers because of their increased safety features, which shield them from fraud and identity theft during payment processes.

Over the forecast period, the smartwatch segment is expected to grow at the highest rate. The focus of vendors on developing affordable smartwatches is expected to increase their uptake. Users can more easily pay their bills due to the smartwatches' Bluetooth, NFC, or RF connections to smartphones. For instance, well-known companies, such as Apple Inc. and Samsung Electronics, have added Bluetooth connectivity to their smartphones so that users can use their smartwatches more effectively.

GCC Wearable Payments Market – By Application

On basis of the application, GCC wearable payments market is divided into Festival & life Events, Fitness, Healthcare, Retail, Transportation, and Others. The retail segment holds the maximum share of the market. The increasing demand for cashless payments in markets, local shops, and e-commerce can be attributed to the segment's growth. According to research, 72% of customers believe that wearable payment devices are the way of the future for in-store shopping. Furthermore, many retailers around the world including GCC are focusing on educating customers about contactless payment technology, which promotes the use of wearable payment devices in the retail sector.

GCC Wearable Payments Market – By Country

Geographically, GCC wearable payments market covers the region’s major countries: Saudi Arabia, UAE, Qatar, Bahrain, Kuwait, and Oman.

Competitive Landscape

Competition in GCC wearable payments market is intense. Major companies in the market include Apple, Inc., Barclays PLC, Google LLC, MasterCard, Samsung Electronics, Visa Inc., and Wirecard. The key strategies used by these market leaders are new product launches, mergers & acquisitions, and alliances. To grow their market share, these companies are also focusing on investing in innovations, collaborations, and expansions.

Recent Developments

• In December 2020 - Mastercard formed a partnership with MatchMove, a Singapore-based Banking-as-a-Service provider, and Tappy Technologies, a world-leading wearable payment integrator, to launch tokenization into a small, flexible chip that could be attached to a range of battery-less wearables and accessories like watchstraps or keyrings, which turns them into safe contactless payment devices.

Scope of the Report

By Technology Type

• • Barcode

  • Contactless Point of Sale (POS)

  • Near Field Communication Technology (NFC)

  • Radio Frequency Identification (RFID)

By Device Type

• • Smart Rings

  • Fitness Tracker

  • Smart Watches

  • Fitness Wristbands

  • Others

By Application

• • Festival & life Events

  • Fitness

  • Healthcare

  • Retail

  • Transportation

  • Others

By Country

• • Saudi Arabia

  • UAE

  • Qatar

  • Bahrain

  • Kuwait

  • Oman