Near Field Communication (NFC) India Market
Near Field Communication (NFC) India Market is expected to reach US$ XX Bn by 2026 at a CAGR of XX% during the forecast period. NFC Technology is a wireless technology for short-range connectivity especially developed for intuitive, simple and safe connection between electronic devices. An NFC chip operates as one part of a wireless link. Once it’s activated by another chip, small amounts of data between the two devices can be transferred when held a few centimetres from each other. Near-Field Communication is evolved from radio-frequency identification (RFID) technology. It allows phones, tablets, and laptops to share data with other NFC-equipped devices. The data transfer includes cash transactions, device control, and many other applications. NFC technology operates on a special chip and application on smartphones. Consumers who have NFC enabled smartphones can use it as a card, by just tapping their phones against NFC enabled payment systems to make the transaction.
IBEF (India Brand Equity Foundation) a trust established by the Ministry of Commerce and Industry, Government of India predicts that India’s demand for semiconductor goods will reach US$ 400 Bn by FY 2025. According to Union Minister of Information Technology, Foreign Direct Investment (FDI) in electronic manufacturing has reached an all-time high of US$ 18.34 Bn in 2016 primarily due to government reforms and it’s Make in India initiative. The Government of India has allowed 100 per cent Foreign Direct Investment (FDI) under the automatic route in Electronics Systems Design & Manufacturing sector. The Ministry of Electronics and Information Technology plans to revise its policy framework, which would involve the government taking a more active role in developing the sector by providing initial capital, with the aim to attract more private players and make India a global semiconductor hub.
India is the most lucrative market across the globe with 7.7% GDP growth rate in the 1st quarter of 2018. The impressive demographic dividend, continuous rise in the proportion of middle class, changing expenditure patterns are the distinguishing factors of the current Indian economy which are consequently attracting the global investment. As per the report by Internet and Mobile Association of India (IAMAI), the number of internet users in India is expected to reach 500 million by June 2018. The report titled ‘Internet in India 2017’ states that the number of Internet users stood at 481 million in December 2017, an increase of 11.34% over December 2016. Urban India consists of 295 Mn internet users out of 485 Mn estimated population whereas rural areas have only 186 Mn users leaving out potential 732 million users. Internet penetration in Urban India was 64.84% in December 2017 as compared to 60.6% last December. In comparison, rural Internet penetration has grown from 18% last December to 20.26% in December 2017. While the government flagship programs like Digital India is paving its way especially in rural India, the pertaining problems like digital gender gap and rural-urban digital divide need to be addressed efficiently.
Serving a card-less and cashless economy in India is no more a distant dream. The growing number of cashless transactions is not only attributed to 3G and 4G services but also to near field communication (NFC) technology. According to the Mobile Payment Forum of India (MPFI), India has about 200 million mobile subscribers, while adding five million a month. NFC technology’s communication protocols allow even people who are not smartphone-savvy to enjoy the benefits of cashless transactions.
NFC, though at a nascent stage in India today, is catching up like a wildfire because of the factors like cross-industrial applications, penetration of smartphones, affordable devices, and mobile internet data rates. Moreover, high-speed internet and Wi-Fi have also added impetus to shopping through mobile devices. With the introduction of 4G, the trend is bound to pick up in the near future. The necessity readiness of various players to interoperate in order to adopt the technology at a larger scale is the key challenge in implementing the NFC technology. Further mobile service providers and banks need to work together to create a seamless ecosystem for the technology to work efficiently. While NFC enabled phones and devices have been introduced in the India market, they are still not as per the expectations. NFC enabled terminals are still not in abundance for the customer to make cashless, card-less payments. The efficient collaboration of smartphone makers, internet providers, and credit card companies will tap the untouched market and bring the multidimensional benefits on fore.
The Near Field Communication (NFC) India Market can be segmented by operating mode, products & software, end-user industry. As of today, the retail industry holds the largest share of the overall NFC India market – growing non-cash transactions, NFC-enabled PoS terminals, and adoption of electronic shelf labels being the apparent reasons. The automotive industry is expected to grow at the highest CAGR during the forecast period as demand for in-car infotainment and touch-less controls are driving the NFC India market in the industry. Major automotive manufacturers are giving emphasis to incorporate additional features in their cars to provide additional safety and control features to their customers.
In the case of operating modes, the peer-to-peer mode which enables two-way communication between two NFC-enabled devices led the Near Field Communication (NFC) India Market in 2017. Given the growth of NFC mobile phones, this mode is expected to grow at the highest CAGR during the forecast period. The market for non-auxiliary products which are built into the device to facilitate NFC communication is largest as compared to the other products. The major consumer electronics companies focus on incorporating in-built NFC features into their products, and this is the major reason for the largest market size of non-auxiliary products.
Tagtual a Bangalore based enterprise is a first company which provides NFC based business cards, wedding invitation cards amongst other products. With these business cards, one can easily share contact information with just a tap of the card to your phone. Many global key players in the NFC market are looking at India with great expectations and have started investing and collaborating with indigenous entities to exploit the available, untapped market. NXP Semiconductors which in partnership with Sony Corp. invented NFC technology in the first place has accompanied YELDI Softcom a recently established Chennai based NFC technology company to develop NFC handsets, cards, backend infrastructure, and mobile apps. PVR, one of India’s premium and preferred retail Entertainment Company is now streamlining its retail function with NEC. These solutions empower PVR to enhance customer experience through better payment mechanisms and streamline its retail functions at a radically low total cost of ownership through its exceptional serviceability and reliability. India’s first Centre of Excellence for the Internet of Things (CoE-IoT) has been launched in Bengaluru with five start-ups, which will provide demonstration and concept labs for building IoT solutions for applications like agriculture, automobile, telecommunications, healthcare, and consumer goods.
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The scope of the NFC India Market:
Near Field Communication (NFC) India Market by operating modes
• Card emulation
• Reader emulation
• Peer-to-peer mode
Near Field Communication (NFC) India Market by Products & Software
• Auxiliary products
• Non-auxiliary products
• NFC Software
Near Field Communication (NFC) India Market by End-user Industry
• residential & commercial
• medical & healthcare
• consumer electronics
Near Field Communication (NFC) India Market by Region
• North India
• East India
• South India
• West India
Key Players Near Field Communication (NFC) India Market
Identive Group Inc.
AT & T Inc.
Infineon Technologies AG.
Marvell Technology Group Ltd.
Mstar Semiconductor Inc.
Texas Instruments Inc.
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