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Mobile payments are gaining traction

November 19, 2013 by Terry Dooley — SVP & CIO, ITS, Inc

The mobile payments industry has continued to gain traction in the past 12 months, according to the recently released "2014 Mobile Payments State of the Industry" report.

Smartphone use is nearly ubiquitous among American shoppers, the report said. More than 90 percent of consumers currently use smartphones compared to 66 percent in 2012. Additionally, 93 percent of respondents reported using their smartphones to access the Internet, up from 65 percent in 2012.

This has led to a lot more people using their phones to shop retail offerings. Sixty percent of smartphone users have used their device to shop and to engage with mobile card processing terminals, up significantly from 41 percent last year.

The survey also found that, in addition to online purchases, many consumers are using their smartphones at store locations. One in four respondents who had used their mobile device to shop said they had paid for a product with their mobile phone at a brick-and-mortar retailer. An additional 18 percent had scanned a QR code from their phone while at the point of sale.

Consumers also admitted to being considerably more open to sending money via person-to-person payments than they were a year ago. Forty-six percent of survey participants reported that they would "consider using email to send or receive money," compared to 24 percent in 2012.

James Wester, founding editor of Mobile Payments Today, predicts that the vast majority of shoppers will adopt mobile payments sometime within the next five years.

These numbers underscore the importance to financial institutions of continuing to offer multiple ways for their customers to pay bills and make purchases. FIs can position themselves as "first movers" by offering a mobile payment platform that customers feel secure using, and educating them about how to use it.

Read more about mobile banking.

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