Mobile payments, including m-commerce, person-to-person (P2P) mobile money transfers, and mobile proximity payments, are set to grow exponentially in the next three years.

Data from global analyst firm Ovum suggests there will be close to five billion people making payments on their mobiles by 2019, compared with an estimated 689.99 million users in 2014. Of these, by 2019, more than two billion people will be using m-commerce to pay for shopping/consumer goods using a smartphone.

With further data to back this up, payment services company Ayden published its Mobile Payments Index, which shows that, in Q4 2015, for the first time, over a third (34 per cent) of browser-based online transactions globally are now made on a mobile device.

Mobile payments and money transfer set for Asian and African growth

China is set to have 370.29 million m-commerce users by 2019, making it the largest m-commerce user base in the world. It's also estimated that, by 2020, four in every five people on the planet will have a smartphone, so the era of mobile payments seems inevitable.

This is already seen in the money transfer market, where competition is hot. Writing in Bobsguide, Massimiliano Alvisini, vice president for Northern Europe at Western Union, says that the biggest markets are likely to be developing countries, such as countries in sub-saharan Africa, where many don't have access to a bank account but do use mobile phones. He writes: “The prolific use of mobile phones for payments in sub-saharan Africa is largely driven by the lack of banking infrastructure across this region.”

Alvisini also notes that companies must be agile and adaptable to deal with the digital landscape, which he says is “evolving at a meteoric pace”.

Competition is fierce in multibillion dollar market

However, money transfer companies also need to keep a close eye on the regulatory environment in all their markets. It's reported by Bloomberg that Western Union has been subject to preliminary questioning by antitrust regulators over its activities in Europe, focusing on whether agreements with its agents are anti-competitive and “allegations of collusion to drive rival money-transfer operators out of the multibillion dollar market.”

A spokesperson for the company said that Western Union is cooperating with the European Commission's request for information. The investigation is focusing on the company's network of agents, which provide money transfer services from corner shops or post offices and which number half a million worldwide.

According to EC spokesman Ricardo Cardoso, the antitrust authority is closely monitoring competitive conditions in the money transfer market. The market is competitive and, since it's set for huge expansion in the coming years, there are numerous players including banks, mobile phone companies, couriers and card providers.