ABI Research forecasts 8.6 billion smart cards will ship in 2013, spanning all smart card markets. Of the total shipments, 16% are forecasted to use a contactless interface but that will rise to 30% by 2018.

Government ID, transportation and ticketing, and payment cards continue strong double-digit growth in contactless adoption. Single-wire protocol SIM card volumes continue to strengthen, and are expected to break the 500 million mark in 2018.

“The increase in contactless adoption is not limited to a selection of markets, although it’s the banking and government verticals which are adopting contactless technology at a quicker rate, with the SIM market close behind,” comments Phil Sealy, research analyst at ABI.

Over the next three years ABI Research expects to see a shift in the penetration ratio of pure contactless and dual interface shipments. In 2013, ABI Research forecasts 59% of all contactless deployments will utilize a pure contactless interface, reducing to 38% in 2018.

The increase in dual interface adoption is apparent across multiple markets. IC vendors NXP, Infineon, and STMicroelectronics are positioned to offer the best combination of convenience and high-end security over multiple applications. Additionally, the increase in dual interface adoption will deliver greater margins benefiting IC and smart card vendors alike.

“ABI Research tracks new services and credentials regionally, including governments issuing new national ID and social welfare cards, mobile network operators with SIM-based NFC payment services and wallets, and banks jumping to next-generation dual interface EMV cards,” Sealy states. “As a result ABI Research forecasts that dual interface shipments will exceed the 1 billion mark in 2015.”