December 22, 2016
Mobile online payments will continue to dwarf mobile proximity payments in stores even as both grow significantly into the next decade, according to a new report. Mobile payments made through browsers and apps will surge from more than $122 billion last year to nearly $319 billion in 2020, according to the report from Javelin Strategy & Research. During the same span, mobile proximity payments will rise from $10 billion to nearly $92 billion. Javelin said it expects the two mobile modes to converge as, first, mobile online payment capability and then P2P payments are included in digital wallets that, until now, were primarily used for proximity payments at the point of sale. The San Francisco-based research firm expects this to benefit issuers offering payment apps that make all three types of mobile payment possible in one place.
“This mobile wallet ‘convergence’ will create value by simplifying users’ choices when it comes time to pay,” said Emmett Higdon, director of mobile for Javelin Strategy & Research. “Banks and card issuers have a unique opportunity to simplify the purchasing experience by offering a single branded wallet solution that brings together mobile payments, money movement functionality, and account management capabilities.”
While Apple, Google and, perhaps, Samsung seem well positioned to take advantage of the convergence Javelin’s report predicts, it suggests bank-branded apps like Chase Pay could benefit most.