Five Things That will Impact Mobile Payments

March 18th, 2015 Posted by 2015, Blog          
mobile payments, mobile apps

What’s in YOUR smartphone?

Looks like mobile payments are finally getting their due. In just the past couple of months, we’ve seen the introduction of Samsung Pay and Android Pay, and PayPal’s acquisition of Paydiant, not to mention the continued growth of Apple Pay.

It’s quite a change from when Google Wallet first launched in 2011. At that time, consumers were not yet at the point where they felt comfortable replacing their cash and credit cards with mobile devices. What’s more, retailers were not yet ready to invest in mobile payment systems that would complement or replace traditional credit card readers.

Since then, several things have happened to make mobile payments a more viable solution:

Smartphone penetration has grown significantly. There are now about 1.75 billion smartphone users worldwide.

Those users are more comfortable using mobile devices for monetary transactions. As an example, PayPal’s mobile payment volume grew to $46 billion in 2014. People have simply come to trust paying through their mobile devices.

Leading retailers got into the game. According to Finer Things in Tech, we’ve seen the number of merchants and trusted brands that accept Apple Pay grow significantly, from this:

Apple+Pay+Sep+2014To this:


We feel the growth of mobile payments will be impacted by several factors over the next two years:

Consolidation and acquisitions

PayPal’s Paydiant agreement and Samsung’s purchase of LoopPay were the beginning of what I feel will be a wave of consolidation within this space. There are still plenty of smaller mobile payment providers out there, like Venmo and PopWallet, that could prove to be attractive acquisition targets for larger companies seeking to strengthen their mobile wallet offerings.

At least one security breach

I hope I’m wrong about this, but with so much focus on mobile payments – and with so much personally identifiable information and data at stake – I think there’s a great chance of at least one major security breach over the next year. Given that, every company involved in the mobile wallet space, both small and large, will need to heavily focus on making sure their payment platforms are rock solid and as impervious to hackers as can be. We’re already seeing this with Apple’s “Secure Element” and Samsung’s focus on secure transactions.

The dominance of Apple Pay

Apple keeps adding new retail partners to its list of Apple Pay vendors, with Coca-Cola, Office Max, Regal Cinemas and many more familiar names signing on in recent days. Expect to see that list truly explode by the end of the year.

Credit card companies becoming major players

Ironically, the ones that might be best positioned to take advantage of the mobile payment trend might be the ones who pioneered old school plastic. Companies like MasterCard and Visa had significant presences at Mobile World Congress this year, and envision mobile as their future. They will continue to look for ways to leverage their massive customer bases and seek to push them toward mobile solutions, such as MasterCard’s MasterPass technology.

Availability on all connected devices

Smartphones and tablets are only the beginning. Already, consumers can make purchases through game systems. Soon enough, they’ll be able to even buy items through car dashboards and other devices, including Apple Watch. The Internet of Things will make this a reality.

Are you interested in learning more about mobile payments, or how your company can develop mobile wallet solutions? mPortal can help. Drop me a line, or contact us.




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