Global Acceptance Transaction Engine (GATE), released its Mobile Wallet Trends Annual Report last month. The report highlights trends of both mobile wallet and mobile payment usage across global markets.
Still in the early stage of development
Mobile wallets are still in early development in most countries, where some areas are starting to see an uptick in success. Worldwide, 2.07 billion consumers will use a mobile wallet to make a purchase in 2019; this is up nearly 30% from the 1.6 billion consumers recorded at the end of 2017. China is currently the largest adopter of mobile payments, but other countries are starting to catch up.
Source & Copyright©2019 - GATE
India has also seen increases in mobile payment usage due to governmental demonetization, and the African market has seen strong growth as well, due to factors such as low barriers to market entry.
Overcoming limitations of current solutions
The report concludes that despite global growth, other markets will need to consider several factors to also become key players in the mobile payment industry, such as:
- Growth Opportunities: generational differences greatly influence payment mechanisms, as well as the availability of technology
- Online Merchant Needs: fraud reduction and compliance regulations, which vary from country to country, play a role in the creation of new payment mechanisms
- Offline Merchant Needs: increased efficiency, cost savings to the merchant, and increased customer loyalty are all benefits to entering the mobile payment space
The report goes on to highlight the potential mobile wallets represent the globally underbanked population. Over 1.7 billion adults (21% of the world’s total population) do not have access to a traditional bank account. A billion of these adults do have access to a mobile phone though and are potential customers for mobile wallets.
Also, Apple Pay, Samsung Pay, and Google Pay have entered the market in recent years and have started seeing some success. However, their growth is hindered by limitations such as:
- Apple Pay: product works only on Apple hardware, which brought about the creation of Apple Card
- Samsung Pay: only a limited number of flagship devices are currently enabled, and requires internet connectivity to function on a long-term basis.
- Google Pay: requires internet connectivity to function on a long-term basis, which can limit growth in certain markets such as India and Africa, traditionally Android-dominated markets.
Mark Gerban, Chief Commercial Officer of GATE commented on how the limitations could be overcome with the GATE solution, “Trends in the ecosystem have clearly shown China leading the adaption of wallets such as Alipay and WeChat, with QR codes playing a crucial role in their growth. However, the usage abroad for these wallets seems hampered via the lack of QR acceptance points, as NFC remains the method of choice for the Western world. Technologies such as GATE could actually solve this problem, as it would allow Alipay or WeChat to enable NFC acceptance globally without any merchant integration, allowing them to become the most versatile payment methods on the planet,”
The report concludes that “Mobile wallets may still be in their infancy in many countries, but the use of technology and features that improve user experience will drive higher adoption and engagement.”
CTMfile take: How are you going to include mobile wallets in your payments and collections?
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