This year, US consumers can expect to upgrade many of their debit and credit cards to include tap and pay functionality, also known as NFC technology.
While the US has long lagged behind other countries such as Canada, Australia, and the UK who have enthusiastically embraced tap and pay (or Near-Field Communication) as a transaction method, 2019 looks to be the year that the US finally catches up.
The Financial Times reported that the slow rollout in the US is attributed to the age, size, and complexity of the US market. Because the US has a significantly larger number of financial institutions compared to the other markets who have embraced tap and pay, the increased complexity has slowed down the adoption of new payment technologies. It has taken longer for merchants to upgrade their terminals and hardware to be able to accept NFC payments and, subsequently, for banks to issue new cards to cardholders.
Since the shift in liability rules for accepting EMV enabled cards in 2015, US merchants have been working to upgrade their equipment to accept these “chip” cards. These newer terminals are also able to accept NFC enabled cards, so now that the market has the upgraded equipment, issuing banks are able to begin sending out new payment cards to customers. The new cards will have the ability to pay with the chip by inserting the card into the terminal, or by tapping the card close to the terminal.
In November 2018, Chase announced that by the end of the first half of 2019 all Chase Visa credit cards will have tap and pay functionality, and debit cards will receive the functionality by the end of 2019. Because Chase has the largest portfolio of credit cards in the US, their move towards tap and pay will also influence other issuing banks to begin rolling out the functionality to their customers.
Tap and pay is an increasingly popular way for consumers to complete a transaction and as more US customers have the ability to simply tap to pay for a purchase, merchants will be able to complete transactions faster and easier than ever before.