Is growth of the mobile wallet slowing?

Written by on October 20, 2015 in Opinion with 0 Comments

Businessman showing empty wallet. Finance and economy.Statistics about the growth, potential and size of the mobile payments market are everywhere. It is enormous – mobile commerce transactions are set to hit $142 billion next year, according to Forrester. Mobile payments are growing 40 percent, year on year according to Juniper Research and mobile retail purchases will exceed an eye watering $700 billion by 2018, again according to Juniper. And, the Silicon Gang (Apple, Samsung and Google) have all launched a wallet.

So what could possibly go wrong?

Because something does seem a little strange. You would have thought that the mobile wallet market is the most dynamic place to be right now. Except a recent Gallup poll in the UK shows that only 13 percent of respondents have a wallet on their phone. According to surveys carried out in the US and Europe, customers are worried about security, privacy and losing their phones. And merchants are busy either developing their own wallet or card (Starbucks being heralded as the one to watch) or getting confused by the sheer number of offerings. In fact, according to even more research, and despite the amount of energy and column inches that Apple has generated talking up its own wallet, 40 percent of independent retailers are not interested in ever offering mobile payment support. Why? Because their customers are not asking them for it. Only nine percent are using Apple Pay. And just because Apple is Apple does not mean that the second year will be easy, in fact Forrester believes it will be harder than the first year.

Meanwhile looking at the other issue, in a recent survey, fully 87 percent of cyber security experts said that mobile payment data breaches will grow significantly in the next year (with, interestingly, the use of public Wi-Fi being the Achilles heel).

And at the moment, we do not even need to read surveys to see the amount of nervousness being generated around privacy. Not only in the mobile wallet, payments and commerce arenas but in many others too. The IoT, for instance, will generate more data than anything ever before it and privacy issues will be a focus for years to come. Stories of hacking are a daily occurrence. It is going to be a long road for Apple and others to completely convince customers of the security  and ease of its mobile wallet.

Like the IoT, mobile payments will ultimately become a way of life. But, across the board, there is a feeling that there is a ‘check’ coming, while we address the privacy and security issues and ask ourselves whether the risks are worth the rewards if we plough on too fast.

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Alex Leslie

About the Author

About the Author: Alex was Founder and CEO of the Global Billing Association (GBA), a trade body focused on the communications sector. He is a sought after speaker and chairman at leading industry conferences, and is widely published in communications magazines around the world. Until it closed, he was Contributing Editor, OSS/BSS for Connected Planet. He is publisher of DisruptiveViews and previously BillingViews. .

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