The payment cards industry should be a top chip supply priority
The looming chip shortage has impacted the payments cards industry. Source: pixabay.com
Over 1 billion remittance cards may not be issued within 18 months, according to ABI Research. In fact, 347 and 740 million payment cards are at risk in 2021 and 2022 consecutively.
This comes as the semiconductor industry experiences significant uncertainty as the demand for chips exceeds the expectations in the industry. And with the rising demand, the supply cannot be met even in the payment cards industry.
Payments cards are among the most essential components of global economic growth for both consumers and enterprises. The issue is not getting the necessary support and attention from the authorities. To carry out digital transactions, access to payment cards is vital. The looming shortage has the capability of disrupting GDP since the lack of remittance cards means less purchases.
The level of impact in this sector will be determined by how the payment cards ecosystem players react. It is vital for all the players to make clear communication, have the highest level of transparency on the issue, education as well as collaboration to enable the ecosystem to have a smooth navigation through the shortage. So far, the involved associations, forums, and industry groups have been top-level. To avoid the panic buying, more detailed and specific info on the supply lead times and price increases should be shared with the wider industry.
While the impact of the chip shortage has been barely noticed in the first half of 2021, it will soon be visible in the second half of 2021. If the problem persists, 2022 could experience severe shortages. The ecosystem players need to implement processes that reduce market disruption even with the ongoing shortages.
We’ve reported that global 5G connections to grow nearly 950% by 2026.
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