Mobile Payment Trends You Need To Know
More and more people are choosing to make payments using their mobile device. Statistics show that mobile payments will increase over the next few years, more platforms will be launched, wearable technology will develop further and decrease in price, and companies will invest more in improving security. Businesses and budding entrepreneurs need to keep abreast of developments in mobile payment trends to meet customer’s expectations, ensure they don’t lose consumers to their competitors, and increase their profits and bottom line.
Increase in Mobile Payments
Just as credit and debit cards replaced checks and cash, ecash, cryptocash, and ACH transactions (digital or virtual money), will steadily replace cash payments at the checkout. It is estimated that by 2016, more than $27 billion will be made in mobile transactions, with users spending around $721.47 per year. More than 37 million people in the U.S will use proximity mobile payments in 2016, with more and more consumers choosing to pay for products and services over $20 with mobile payments (where previously it was for Starbucks, or goods under $20). Business owners need to recognize that consumers want to pay on the go using the latest technology, to make their purchase quickly, smoothly, and safely.
Faster, More Secure Mobile Payments
A survey commissioned by Bankrate found that 63% of those aged 18 to 29 do not have a credit card, preferring other methods of finance instead. This could be due in part to cyber security threats and bad press, meaning that people avoid using credit cards when purchasing goods or services online.
The risks associated with mobile payments also concern many consumers. ISACA found that only 23% of people felt that mobile payments succeed in keeping personal information safe, and 47% saying they felt mobile payments were not secure. However, although many people expressed their doubts and said they felt data breaches would increase, 42% of respondents had used mobile payment methods last year.
Thankfully, mobile payment providers are on the look-out for ways to provide higher security measures, with fingerprints replacing passwords and the increasing use of NFC. NFC (near-field communication) technology allows two devices equipped with an NFC chip to share data, thereby allowing mobile payments to take place. The devices must be within a few centimeters of each other.
The Rising Popularity of the Mobile eWallet
Mobile ewallets are a means of storing credit and debit card information in an app on a smartphone. At the checkout, the information is transferred to the payment terminal in-store. eWallets are difficult to steal or duplicate, which is great news for consumers who are concerned about fraud. Other good news on this front is that advanced biometric recognition processes are being developed and tested, such as voice recognition, pulse, and keystroke detection.
Mobile payment providers have plenty of work to do in developing strategies to protect consumer’s data, while at the same time, they also need to invest in educating the public about their services, the risks, and the effective measures that they already have in place.
More Mobile Payment Platforms to Launch
As well as Apple Pay, Android Pay, and Samsung Pay, more companies are launching their own mobile payment platforms. Walmart Pay allows customers to pay with their smartphones in Walmart stores through their very own Walmart app. Customers scan the code displayed at the register to connect to the app and an electronic receipt is sent to their smartphone confirming payment. Simple!
More Wearable Technology
As well as more platforms becoming available, wearable technology and clothing embedded with internet-connected electronics which exchange data with other devices or manufacturers, will become increasingly popular. EMarketer has predicted that by 2018, nearly 50% of 25 to 34-year-olds will use a wearable device, with 47% of 35 to 44-year-old internet users doing the same.
Businesses need to stay on top of mobile payment technology and ensure that they have the right equipment – and knowledgeable staff – to be able to meet their customer’s expectations at the checkout.