There will be 516 million mobile users of NFC-based contactless payment services by end-2019, according to Juniper Research.

The projected take-up is a more than fivefold increase over the 101 million NFC-based users in 2014, it said.

Juniper attributes the growth to the popularity of two factors. Firstly, the considerable traction already enjoyed by Apple Pay, the new NFC-based service that only launched on 20 October.

The second factor is Host Card Emulation (HCE), which allows sensitive data for transactions to be stored on, and accessed from, cloud servers rather than a mobile device and without the use of a hardware-based secure element.

Banks, in particular, already seem to be favouring HCE-based solutions which can be integrated into their existing customer apps.

BBVA, Bankinter (both in Spain), as well as Australia’s CUA, have already launched services, with more likely to follow.

The report said the popularity of NFC and the rise of HCE “threatened the opportunity within NFC for MNOs” which back a secure element approach.

“We would envisage that while NFC deployments and consumer activity will be buoyed by these developments, the opportunities for network operator involvement are limited. Hence we are likely to see more operators re-evaluating their existing commitments to NFC and possibly withdrawing from the space,” said report author Windsor Holden.