If there’s ever going to be the Year of Mobile Payments, it’s finally coming – but we’ll have to wait until 2016 to see it, according to a new report from eMarketer Inc.
Mobile payments have been on our radar for a few years now, but as of yet, we haven’t seen any mass adoption. For consumers who are trying out mobile payments, most are just using them to make small purchases, like when they fire up the Starbucks app to pay for their morning coffee.
However, that should all change come 2016, when transactions increase in value by 200 per cent, hitting a forecasted $27.47 billion. By 2018, consumers’ spending using mobile payment could increase another four times, reaching $118.01 billion, and more than 25 per cent of U.S. smartphone users will use mobile payments.
So what’s holding consumers back from embracing mobile payments? According to analyst Brian Yeager, who wrote the eMarketer report, one of the big reasons is that the space is still pretty fragmented. Right now, there are a whole slew of different payment solutions providers, platforms, and tools consumers and merchants can use, but nothing really that compelling for mainstream users.
Plus, most consumers just aren’t convinced mobile payments are any better than using their debit and credit cards to pay for their purchases, Yeager points out. However, what may change their perception is the announcement of Apple Pay, which was made last month. The feature is rumoured to be rolling out to Apple’s retail partners as early as this week, according to a story from Mashable.
However, what’s key here is the feature needs to work well, if consumers are to be convinced, Yeager says.
“Apple Pay will do a lot to bring consumer awareness to mobile payments, but it still has to work,” Yeager said in a statement. “If new Apple Pay customers get excited to try the product and there are hiccups the first time they use it, that’s going to be a negative experience, and they might think twice about trying it again. Regardless of how good the technology is, adoption is also contingent on merchants using it properly and dedicating the resources to train their staff at the point of sale.”
This year, at least one in 10 U.S. smartphone users will be considered mobile payment users, meaning they’ve completed at least one proximity payment transaction using their mobile device.