We hear a lot about the explosion in mobile payments, and new analysis by Gartner supports the idea that the tech is rapidly expanding–it’ll rise 44% worldwide to over $235 billion worldwide this year. But Gartner’s data may contain a surprise: The growth in use isn’t to do with NFC wireless payments or even e-wallet enterprises. Mobile payments are more about money transfers and bill payments.
In fact money transfers will be 71% of this year’s transaction value, and Gartner expects this share to remain high, even up to 69% in 2017. The analysis suggests that more people are using their phones to make money transfers partly because more banks and financial institutions are making the facility available (and more members of the public have smartphones). It’s also noted that transfering cash in this manner can cost less than using a traditional banking route.
E-wallet payments, like Google’s Wallet or ISIS’s NFC system, are only predicted to be 2% of this year’s transaction value. This sort of payment, widely expected to be the poster child of mobile pay, is only going to rise to 5% of all mobile transactions in 2017.
Apple is often suggested to be key to driving mobile payment growth, but the company has thus far stayed away from direct payment technology like NFC. Instead it’s developed its own backchannel payment technology that uses iTunes customer payment data. Low security may be one reason behind Apple’s hesitancy. There’s a strong suspicion Apple will include fingerprint technology in upcoming phones, and this could be one way it solves the security issue of mobile pay.KE