Mobile money transaction is fast replacing the traditional methods of doing business. According to a new study by Juniper Research, the number of contactless transactions will pass 10 billion in less than four years. Currently the number of those who transact via mobile handsets stands at 3 billion.
In the same study, it was projected that the number of consumers using mobile to make payment will increase to 300 million in less than three years. This is a huge number considering that last year the number was just slightly over 110 million. This leap is due to the increased penetration of mobile telephony and the ever increasing innovative ways of doing contactless payments.
The latest study reveals that apart from the mobile handsets, there are contactless point of sale terminals which are increasingly being rolled out by major providers such as VeriFone and Ingenico. These providers ship a majority of their terminals with near field communication (NFC) as standard. There are quiet a number of markets that are being seeded for the adoption of these terminals. Once the roll-out is complete, we would expect the number of people using mobile money transaction to increase tremendously; given also the projection that 500 million phones with NFC support will ship this year, and the mobile money landscape is also enormous.
Some industries are more prepared than others. Among them are the quick service restaurants which are intending to use mobile payments to help serve their large number of customers through checkout, and some brands or retailers that intend to use mobile wallets to combine coupons with shopping lists.
China and the Far East are expected to lead in the value of mobile transaction. In the Mideast and Africa, money activity is being driven mainly by money transfer transactions, which according to Juniper, are already accounting for more than 92% of all mobile transaction value.It is also driven by the low and the middle-class who want to save but can not afford the bank charges.
The study also projected that within the next four years one fifth of all handsets will house mobile wallets, and the amount of money transacted through mobile devices is expected to exceed $500 billion this year. This is not a small change as it represents a 40% increase from last year. This change is due to a combination of different uses of mobile devices. It is worth noting that the number of people using their mobile devices to pay is still increasing.
But why is mobile money transaction so popular? Mobile money transaction is efficient and reliable. It reduces the cost of doing business and is very simple to use. It is also safe and trusted because all transactions require your secret PIN, and your account sits with the provider or with your bank, so you don’t have to carry cash around, which you might lose. Mobile money transaction is also very convenient; you can make transactions on the go, anytime of the day. Furthermore, it is a gateway to other financial services such as credit, insurance and target savings.