Abstract
Market Saturation and Refurbished Units affect Demand for EFT/POS
Terminals
Manufacturers of electronic fund transfer/point-of-sale (EFT/POS) terminals
and systems across the world are challenged by the demand saturation for such
equipment, especially in the United States and Europe. Their problems are
further compounded by the presence of a sizable market for refurbished units.
This is forcing them to explore new geographic regions such as India and China
and provide compelling value propositions in terms of software and services -
rather than just relying on equipment price reductions - to increase their
market share and profits. They are also pinning their hopes on emerging consumer
segments - particularly, Quick Service Restaurant (QSR) that has less than 10
percent terminal penetration and the government sector in the United States - to
generate more revenues and register growth.
This Frost & Sullivan research examines the world market for EFT/POS
terminals and provides a detailed market trend analysis including discussions on
major challenges, drivers, and restraints in each geographic region. It also
presents an in-depth examination of the competition apart from offering
extensive unit shipment and revenue forecasts, which will help companies to
ascertain their current and future growth potential.
EMV Migration and Replacement Sales to Revive Demand
Three major card associations - Europay, MasterCard, and Visa (EMV) - have
mandated that all POS terminals should be capable of reading chip-based cards.
This is likely to drive replacement sales as many terminals lack upgradation
capacity and will opt for new terminals with EMV compatibility. "The
fast-approaching deadline for the EMV migration - 2004 for Latin America,
January 2005 for Europe, and 2006 for Asia Pacific - is likely to revive the
demand for POS terminals," says the analyst.
In case of the POS systems too, the equipment that were purchased prior to
the launch of Pentium processors and those bought in preparation for the Y2K
problem do not have the upgradation capacity. These systems are likely to be
replaced in the coming years and this is expected to encourage market growth.
Markets with Low Credit Penetration Hold Untapped Revenue Potential
The current credit penetration in India and China is relatively low and the
payment infrastructure is underdeveloped, providing tremendous market
opportunities for participants. "Manufacturers of EFT/POS terminals and
systems should focus their efforts on these burgeoning economies as the payment
card industry is witnessing prolific growth and is likely to continue in the
future," concludes the analyst.
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