From a cold start to a bright future in less than six years! In 2008, a well-respected analyst house reported that “Europeans show little interest in contactless payments”. However, in 2013-2014, the two biggest card associations confirmed that contactless transactions had trebled and that spending had increased six-fold. So who is successful and why?

Let’s look at why contactless – CL - payments have the potential to reach a wide audience. First and foremost there are clear benefits for the three main parties involved - customer, merchant and bank. However, inspite of this, many countries struggle to make CL relevant to their markets.

Some countries have been successful and there’s a lot other markets can learn from them. Take Poland and Slovakia, for example. In both countries more than 50% of cards and POS terminals are CL-enabled, so that consumers can use contactless cards in supermarkets, for travel and for buying low-cost items such as newspapers.

This didn’t happen by chance. Banks in both countries attempted CL deployment early, however the lack of scale in cards and POS terminals meant that the technology didn’t catch on with retailers and customers. Success came when more and bigger banks implemented CL, investing in a significant number of CL-enabled cards and POS terminals. This was done over a short period and in cooperation with other parties, particularly retailers and public transport in the capital city. Educating customers about the possibilities of CL payments was another major success factor.

In Slovakia, seven banks implemented CL and issued cards to customers between late 2010 and early 2011. In addition, the Bratislava local authorities facilitated incorporating discounted travel-card functionality and other benefits into CL debit cards of initially three and now - six banks. Shortly after, leading retail chains, in co-operation with their banks, boosted their CL promotion. Low-value items kiosks followed, as more retailers identified new opportunities to improve customer experience and get ahead of the competition. All this resulted in VISA declaring Slovakia as ‘hero market’ in June last year – No 2 in Europe for contactless technology, with CL making up 60% of all cards in Slovakia (1.4 million).

Above all, the experience in Slovakia shows that market acceptance of contactless payments avalanches once the majority of banks embrace it. For banks there’s the opportunity to deliver new services to customers while using familiar hardware – a plastic card. Retailers benefit from improved customer behavior analytics to develop flexible payment methods that entice customers into the store and encourage spending. And, of course, customers are attracted by convenience and greater security. It’s a pretty compelling mix and one that other countries are sure to follow soon.