The acceptance of mobile payments by consumers and merchants is no more skepticism. The success of Starbucks has proven that there is a gigantic market of mobile money waiting for the world. The assortment of mobile technology and unique loyalty programs introduced by Starbucks have handed a new blueprint to success. One of the major element behind this astounding growth in mobile payments is insurgence progress in mobile penetration. The global mobile penetration rate is predicted to surpass 96% at the end of 2013 (128% in developed and 89% in developing- data by ITU), which eventually provides accurate evidences of existing resources to be used.
In spite of various success stories, there is varied insights (in terms of definition, benefits and value) of mobile payments in developed countries & developing countries. Mobile wallet in developed countries is just accumulation of existing payment methods which resolve the issue of carrying too many cards which involves credit/debit and loyalty cards. The only benefits, the consumers of developed countries can avail are easy and faster services through their existing resources. Though the exact value to user is yet to be defined. While a mobile wallet in developing countries is more than a substitution of transaction instrument. It’s fast, secured and relatively inexpensive with a very high value to it’s users. We have the specimens of mobile wallet in developed counties such as Google wallet, Paypal so on and so forth while MPESA, G-CASH and eSewa are making its mark in developing countries.
Mobile payments is still in it’s inception however the foundation of this technology driven arena is already set. We just need to concentrate on issues pertaining to the primary barriers in it’s acceptance. One major issues, we face, is in consumer perception towards mobile payments. The customers consider that mobile payments is only for smartphones users. It has always been a challenge to educate customers that any Java enabled phone supports mobile payments. Communicating right information is also the most important part of endorsing mobile money. Lets take an example of a farmer residing in a remote area in an underdeveloped country. He should be clearly communicated the unique advantages of mobile money such as receiving remittance in his mobile phone and then paying for seeds through his phone itself. He can pay/sign up for different farming programs through mobile phone and receive alerts regarding rain & market rates.
Excessive usage of cards is also a hurdle in the acceptance of mobile commerce. Most of the promotions and discounted offers are applicable to payments by cards. There are very few initiation (except Starbucks) in terms of promotions, in-store coupons and redemption in mobile payments. However, mobile could be the best instrument to provide with any promotional coupons or membership cards. The customers need not to carry extra loyalty cards except their mobile phone. Merchants can register consumers using their mobile number and all the loyalty coupons can be tracked at fingertips.
Furthermore the talk of the town is the concern of high level of security in mobile money. We all have witnessed that even cards have suffered years to be proven safe. I believe that mobile money would also go through the similar phase. Once consumer will experience mobile payments and it’s distinctive benefits, they will surely find themselves hooked to the services.
Despite the fact that mobile money is yet to speed up in developing countries, there are new developments emerging in. A number of strategic partnerships for mobile payments is occurring across the Globe whereby users can enjoy instant messaging with a whole new mobile payment platform. Considering all developments, we can surely assess the exceptional prospects of cashless and card less world.
By Pankaj Kumar, Chief Marketing Officer, F1Soft International
About the author – Pankaj Kumar is Chief Marketing Officer at F1Soft International and specialize in Mobile Payments, Mobile Money Remittance, Strategic Partnership and Global Business Development.
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