Major Mobile Wallet Market Trends Identified by TechNavio Analysts
Mobile payments are increasingly offering quick, easy transactions and opening the door for personalised service that both merchants and customers can appreciate.
The market is growing, with companies like ISIS, PayPal Inc., and Visa Inc. joining the game with their own offerings. But the mobile payment ecosystem extends well beyond just vendors, and incorporates regulatory authorities, financial institutions, telecom operators, merchants, users, and technology providers. Each of these stakeholders is interdependent and they all seek to enhance mobile payments with location-based services, consumer preferences, digital coupons, and reward points, which transforms mobile payments into a complete mobile wallet.
The Global Mobile Wallet Market has gained traction and is still projecting steady growth, with a CAGR of 10.6 percent from 2014-2018.
TechNavioanalysts have taken a look at some of the key trends driving this market over the forecast period:
Higher Dependency on Mobile Phones
Maybe it’s becoming a cliché, but it doesn’t make it any less true—we are glued to our mobile devices. And for good reason: They allow us to get what we want, when we need it. They streamline our business, increase our social interactions, make banking easier and even make our morning coffee run simpler. Convenience has become a commodity that businesses want to leverage, and our dependence on mobile phones is a huge part of that. This has been a huge factor in adoption of mobile wallet services.
Increased Use of Mobile Commerce
Buying goods online has changed the way organizations do business, making products accessible to customers anytime, anywhere. So it’s just natural that mobile commerce would be a major segment in the Global Mobile Wallet Market. Mobile commerce offers flexible, easy payment services to clients and also enhances the brand recall value, which benefits merchants.
Increasing Competition among Vendors
Mobile wallets are still evolving and there are currently numerous players trying to gain a foothold in the industry. Some key players in the market are Visa Inc., MasterCard, American Express Inc., PayPal Inc., Google, ISIS, and Square Inc., and they all have one thing in common—they are focusing on bringing consistently innovative products to the table at affordable prices. With the launch of Google wallet, ISIS, and PayPal Wallet, the market is expected to witness progressive growth during the forecast period. Further, MNOs play a crucial role in the whole model along with payment networks, and merchants that are also attempting to gain market share.
Better Consumer Confidence
Vendors are constantly working to improve the security mechanisms of mobile wallets, as clients become more aware of the risks and demand higher security measures, such as fingerprint identification technology. Increased security in mobile wallets will raise client confidence in the model and will encourage more people to adopt mobile wallet services.
These security concerns as well as infrastructure issues are posing minor challenges for the market, but this can be expected from any new technology. As NFC technology becomes more popular and security issues are tackled and resolved, any negative effect these concerns might have will be increasingly marginalized compared with the growth expected in the market over the next four years.