August 24, 2016
Report: NFC to Represent Only One-Quarter of Mobile Payments by 2017
Nov. 19, 2012
In 2017, when the global total volume of mobile payments will exceed $1 trillion, mobile Website or browser purchases will account for two-thirds of mobile transactions despite some inroads being made by NFC, according to a new report from IDC Financial Insights. Currently, the overwhelming share of mobile payments conducted online on a mobile device (rather than using the phone itself to make a contactless payment of some sort) caught IDC by surprise, according to Aaron McPherson, practice director of payments and security for the Framingham, Mass.-based firm.
“If you look at total mobile payments of about $146 billion this year, 95 percent of that is m-commerce and nearly five percent is funds transfer,” McPherson told CardNotPresent.com. “Less than one percent is proximity, which includes NFC and barcode.”
While NFC continues to dominate headlines, McPherson said m-commerce is the area where real value has been created.
“It’s really in the digital content area,” he said. “You have people in many cases buying music they already have; same with digital movies. It’s created this other opportunity to sell content that’s been repackaged. It’s very significant. [M-commerce’s] impact is much more profound right now. I just think NFC has the visuals. Tapping a terminal makes for very good pictures.”
McPherson is careful to say that the notion of NFC as over-the-horizon hype, however, is very much a U.S.-centric idea. From a worldwide perspective, notably in Japan and South Korea, NFC is very much mainstream. But, even in the 2017 time horizon its report examined, IDC expects NFC to account for only 25 percent of the $1 trillion total spent worldwide using mobile devices.