Michelle Evans of MobilePaymentsToday recently wrote an article about the top trends shaping mobile payments in 2016. Citing a Euromonitor International survey, Evans reports that mobile-driven commerce will reach an estimated $972.25 billion across 46 markets in 2016, with mobile payments expected to hit $3 trillion by 2021.
More specifically, mobile’s ratio of digital commerce in the United States is slated to increase from 20% in 2015 to 46% in 2020. Meanwhile, an estimated 38% of digital commerce in the U.K. is expected to occur on a mobile device in 2020, up from 12% in 2015. It should be noted that 17% of all consumer payments are already executed via a device in the UK, with mobile emerging as the clearly preferred device for commerce.
“As mobile phones cement themselves as the most popular device on the planet and mobile-based commerce continues to expand leaps and bounds, the market potential in the next 10 to 20 years remains enormous,” she explained. “The stakes are certainly high for payment players, merchants and brands, which are all fighting to be among the first to get mobile right and gain significant adoption among an increasingly more connected consumer base.”
As Evans points out, remote mobile payments currently capture the largest slice of the mobile payments pie, although smartphone proximity payments in brick-and-mortar stores are increasing.
“Ultimately, mobile payments must be as cheap, safe and easy to use as traditional payment methods to even be considered a viable option,” she added. “In order to encourage wider adoption and ensure high usage, mobile payment players will have to provide a value add, which could come in many forms, including monetary savings, improved security, ease of use, convenience or increased loyalty.”
As we’ve previously discussed on Rambus Press, next-gen mobile payments are likely to evolve a new retail paradigm that will help redefine a traditional brick-and-mortar experience which has grown stale and static for consumers and purveyors alike. For example, mobile wallets housed on smartphones will allow retailers to collate purchasing data and track trends; increase upsell, cross-sell opportunities and brand loyalty; reduce transaction fees with integrated credit card payments; minimize staffing requirements for check-out lines; and free up more store space for actual products. For consumers, mobile payments offer a convenient “tap and go” frictionless commerce experience that effectively eliminates the waiting time EMV card readers have added to transactions.
Unsurprisingly, Google has already taken the next step for a true frictionless commerce experience by introducing a new Hands Free app that allows users to make in-store payments without ever taking out their smartphone or wallet. Meanwhile, Bluetooth beacons, along with the superimposition of digital content on top of a view of the real world (AR), offers us an exciting glimpse into a future world where online behavior seamlessly blends into offline activities. Similarly, biometric security continues to evolve, with more advanced techniques likely to be integrated into next-gen wearables to enable quick, effortless and secure mobile payment transactions.
Interested in learning more about mobile payments? You can check out or mobile payments page here.