The Mobile payment revolution
The most significant evolution in wireless payments is mobile payment, with emblematic offers such as Apple Pay, recently followed by Google Pay and Samsung Pay. In its 2013 issue, the World Payment Report already noted an increased penetration of smart phones and Internet usage, pointing out that one of the biggest revolutions in financial services was coming through the increased use of portable devices for banking, online shopping and, increasingly, making purchases at the checkout. Such devices also power card-based transactions at physical stores through apps, scannable QR codes and attachable card readers that transform them into cash registers.
According to a PwC report, mobile payment volumes could reach 10 percent of the $2 trillion in small cash transactions – those involving $25 or less.
Providing new business opportunities
This could put more than $20 billion in play for the financial services industry – through both new revenue opportunities and avoiding potential losses from the defection of customers. The revenue opportunities include new fees from mobile spending, the conversion of small cash transactions to mobile payments and new value-added services, such as m-commerce, mobile ads, mCoupons and virtual currencies.
There is an opportunity for newcomers who can provide online payment systems or online end-to-end solutions and improve collaboration to foster standardization and open platforms. Banks keep an early lead due to customer relationships and confidence in their security.
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