Wearable Payment – Will it Just Continue to Remain a Trend or See a Serious Adoption?

By Sankhadeep Chakraborty . August 22, 2021 . Blogs

Imagine entering a shop, purchasing things, and paying for them through a watch, a ring, or a bracelet?

No, that is not a scene from a sci-fi novel or movie. But, it’s the reality, which we will soon see all around us. What I described right now was a wearable payment device.

Wearable payment is a wearable device that allows customers to make contactless payments. Considering that it is still at the nascent stage, the transaction limit is not too high. The Reserve Bank of India (RBI) has raised the limit for contactless payment to INR 5,000.

Although wearable payment devices were around for quite some time, the real surge was witnessed during the pandemic when both customers and merchants preferred contactless transactions. Major banks such as State Bank of India, Axis Bank, Sweden’s Länsförsäkringar Bank are some of the recent players who are making wearable payment a mainstream reality.

Benefits of Wearable Payment

Wearable payment serves many benefits. It’s convenient as customers do not have to carry cash or multiple cards with them wherever they go. It’s safe and also easy to use. Wearable payment also speeds up the transaction process. If card transactions take 30 to 45 seconds, transactions through wearable payments take just 10 to 15 seconds. Also, considering that it is more discrete than cards and cash, there are fewer chances of getting stolen. Even if it gets stolen or lost, the customer can delink their bank account with the wearable.

Wearable payment is a boon for banks too as they can reduce the instances of counterfeit cash and cards used for transactions.

The need for devices like these has grown so much that studies predict the wearable payment device market will become an $82 billion market by 2026.

But the larger question is will it be a passing trend or will it see a serious adoption in the future.

It’s a question that made me curious too, and I decided to dig further.

What’s in Store for Wearable Payment?

The need for digitalization and contactless transactions became even more apparent during the pandemic when banks encouraged customers to use their digital services to avoid crowding at bank premises. As a result, traditional ways of banking had to change completely. Now, even as things are slowly returning to normalcy, customers and merchants have become accustomed to the convenience of wearable payment. The banks, on their part, are also infusing money into making it more sophisticated and user-friendly. Even lifestyle brands like Swatch and Titan have jumped on the bandwagon to create their line of wearable payment products.

And although a trial by Belgian Bank showed that debit cards were the preferred mode of payment for the trial participants, wearable payment was not far behind. They were ranked above cash as a preferred mode of payment.

This proves that wearable payment might become a mainstay in the banking industry.

However, banks and device manufacturers still have a lot of work to do to increase adoption.

In his 2015 LinkedIn article, Stephen Wooters suggested adding value to wearable payments and focusing on solving the customer’s main problems. Comparing it with a Tag Heuer watch and jewelry, Wooters says that wearable payments must go beyond functionality. It must be a form of self-expression. He also suggested that the wearable payment must serve multiple purposes and not just limit itself to aiding payments. It should provide the customers a seamless experience. Wearable payment will be successful if it provides an immersive experience to customers.

But the million-dollar question is who is responsible for creating this experience? Is it the device manufacturer, bank, or lifestyle brands? Valerie Gleize of Thales says that it depends from case to case. Either lifestyle brands could add wearable payment as an additional feature to their existing product, or banks could decide whom they would like to partner with to create this experience.

Apart from improving the experience, banks also need to think of other critical issues, such as the security of the device, availability of contactless POS, and other complexities associated with contactless payment. They must invest in more contactless POS terminals to encourage customers to use wearable payment. Banks must also pay attention to privacy issues. Last year, New York City launched a contactless payment system called OMNY for their city buses and subways. While it provided convenience to passengers, there were plenty of privacy concerns. The system collected the passengers’ personal information such as their location, payment and transport data, and other details.

Banks should also be mindful of the digital divide that could be created because of wearable payment, as many sections of the societies still transact with cash or do not have a bank account, which makes adoption a slow process.


As wearable payments get more popular, banks must address the teething problems soon and make the adoption process seamless for all customers. To improve the adoption of wearable payment, banks, device manufacturers, and lifestyle brands must work together. They must focus on strengthening its security and making it more user-friendly for customers. Most importantly, they must bridge the digital divide to make it more accessible for customers living in different strata of society.

Sankhadeep Chakraborty

Sankhadeep heads the engineering arm in Verinite. He has been associated with the BFSI domain from the start of his career. He is a hardcore techie and innovation drives him. He believes in the saying "Nothing is impossible"

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