Advances in technology, awareness and accessibility have led to an impressive expansion of mobile payments services across the globe. By 2020, 90% of all smartphone users are expected to have made a mobile payment (Source: Techradar), with mobile transaction volumes predicted to surpass $1 trillion by 2019. (Source: Statista)
One of the developments supporting the growth of the mobile payments market was undoubtedly the launch of Google Pay in September 2015. And with Google’s platform continuing to hold a central role within the ecosystem, banks and service providers are integrating.
What are the benefits of Google Pay?
For consumers, Google Pay is a simple, secure and convenient payment method that reduces friction at checkout, both in-store and in-app. And as the integration of value-added services is a proven means of helping to drive adoption, it also delivers an enhanced buying experience for the consumer through rewards, loyalty and couponing. (Source: ABA Banking Journal)
For banks,Google Pay enables them to provide their customers with a simple and secure method to use their credit and debit cards. In addition, with consumers increasingly demanding mobile payments services, Android Pay enables banks to quickly deliver these services to a large percentage of their customer base.
The security behind Google Pay
Adoption of mobile payments is dependent on convincing consumers that it is a secure payment option. Google Pay, therefore, implements various technologies and protocols to deliver enhanced payment security. Crucially, the platform utilizes tokenization, which replaces traditional primary account numbers (PAN) with unique identifiers called payment tokens, to protect transaction data and mitigate fraud.
What’s next for Google Pay?
The future of Google Pay looks set to feature wider deployment and integration. And with wearable payments predicted to overtake plastic cards within 5-7 years, there is an expectation that Google will move in on this lucrative market (Source: Gadgets & Wearables).
With Google Pay expanding across geographies and form factors, it is clear that banks must work to develop, define and evolve their strategies. But to do so, they must fully understand the key market drivers, the underlying technologies and the benefits Google Pay can deliver to consumers and banks across the payments ecosystem.
Find out how banks, payment schemes and processors can work with Rambus to integrate with Google Pay.
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