The report also reveals that growth in mobile contactless transaction volumes will significantly exceed contactless card volumes by 2023, as mobile contactless transactions grow twice as fast as contactless card transactions.

The Juniper Research report identified the enhanced security and increasing cross-channel payment capabilities of mobile contactless payments as key drivers of growth.

The report - Contactless Payments: Trends, Opportunities and Market Forecasts 2021-2026 - recommends that mobile contactless payment wallets fully leverage opportunities for value-added services, such as loyalty schemes and personal financial management, to differentiate their digital wallet services in this competitive market.

The research forecasts that Latin America will experience growth of over 400% in contactless mobile transaction volumes between 2021 and 2023.

It predicts that increasing smartphone penetration, alongside improved access to digital financial services will drive demand for digital wallets services in the region over the next two years.

“Latin America has seen rapid development in its digital infrastructure in recent years, shown by the increased investment into supporting digital transformation, as well as an increasingly favourable regulatory environment. This will further drive payment digitalisation in the region,” said research author Susannah Hampton.The research also found that low trust amongst consumers is a key hurdle digital wallets face and, consequently, it urges wallet vendors to increase support of biometric authentication in their services to allay the fears of those hesitant about adopting the technology.

It found that the ability of mobile payments tokenisation to reduce the scope of payment security requirements means that the tokenisation of mobile payments will become ubiquitous.

Juniper Research says it anticipates that by 2023, 99% of all contactless payment transactions by volume will be tokenised.