As mobile payment transactions are on pace to hit $235.4 billion in 2013, it has been noted that this is mainly through money transfers and that NFC payments and services such as Google Wallet have failed to gain much traction. Gartner recently published its latest forecast on worldwide mobile payment transaction values, calling for this year to see a 44% increase from the $163.1 billion in mobile payments made in 2012. Money transfers alone were projected to account for about 71% of total transaction value in 2013.
On the other hand, near-field communication and e-wallet transactions are only forecast to account for 2% of total mobile transaction value in 2013. This is because high-profile NFC services such as Google Wallet and Isis aren’t catching on with consumers according to Gartner. In fact, the research firm has reduced projected NFC transaction value by 40% for its forecast period, which runs through 2017. By then, Gartner believes that NFC payments will still only account for 5% of total mobile transaction value.
Rumors of Apple adopting NFC technology in the iPhone have been persistent for several years but Apple has instead chosen to avoid wireless “tap to pay” so far. Security concerns associated with NFC have mainly been cited as a reason for Apple’s lack of support. Instead, Apple ended up introducing Passbook, a new feature that was released with iOS 6 that collects store cards, coupons, boarding passes, and event tickets. Some industry watchers have speculated that Passbook sets the stage for Apple to introduce e-wallet functionality to the iPhone but the company hasn’t made any move regarding the matter, at least as of yet.
Although NFC remains a niche, money transfers are expected to remain the predominant use for mobile transactions, remaining at 69% of total value in 2017. Most of the growth comes from money transfers as users have begun to transact much more frequently at lower values due to the availability of services. Mobile transfer services also frequently see lower transaction costs than traditional banks. The forecast calls for merchandise purchases to account for 21% of total mobile transaction value in 2013. Growth in the segment has been stifled because “the buying experience on mobile devices has yet to be optimized” according to Gartner.
One of the expected large growth segments in 2013 is a mobile bill payment, which the forecast suggests could grow 44% this year. The firm noted that more consumers in developed markets are performing bill payments via mobile banking services and bill payments will grow to account for 5% of total mobile payment value in 2017. According to research director Sandy Shen at Gartner:
We expect global mobile transaction volume and value to average 35 percent annual growth between 2012 and 2017, and we are forecasting a market worth $721 billion with more than 450 million users by 2017. Nevertheless, we have lowered the forecast of total transaction value for the forecast period due to lower-than-expected growth in 2012, especially in North America and Africa.
Source: Gartner via AppleInsider