Mobile Payments Are Poised To Take Off In The US

Mobile payments have a huge amount of room for growth.

But the U.S. has been lagging behind mobile payments leaders like Asia-Pacific and Africa. In 2013, U.S. mobile payments and commerce already combined for about 2% of total credit and debit card volume.

However, we believe U.S. mobile payments are poised for strong future growth. Mobile-based transactions in the U.S. have grown 118% per year on average for the last five years. It’s what will make the U.S. a leader in the mobile payments space going forward.

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In the report, we put numbers to the trends and explain why mobile transaction volume is growing so explosively. A significant portion of card-powered e-commerce transactions take place on tablet or smartphone devices. Tablets and smartphones are also powering card-based transactions at physical stores through apps, scannable QR codes, and attachable card readers that transform devices into cash registers.

The report answers the main questions surrounding this rapidly growing industry:

  • What exactly is a mobile payment?: There’s a lot of confusion out there about what constitutes a “mobile payment,” and we reiterate our definition. A mobile payment occurs when a mobile, Internet-connected device is used to facilitate a transaction that might otherwise have taken place using a physical credit card, check, or cash, at a store or point-of-sale. Mobile transactions are a larger category that includes these payments, but also includes mobile commerce, or e-commerce channeled by an app or mobile website (e.g., Amazon’s iPhone app).
  • Are consumers taking to these solutions?: Smartphone users are becoming aware of mobile wallets, payments apps, and QR-scanning apps and using them to facilitate offline and online purchases — most famously at Starbucks coffee stores. However, overall usage is still low. We look at the dynamics that will drive future adoption.
  • Who’s winning in this space?: Payments start-ups are enjoying massive growth and helping to push forward innovation. A wave of acquisitions and mergers will clean this space up.
  • How fast is innovation occurring?: It’s happening all the time. For example, Amazon’s “Pay With Amazon” product allows the 215 million active Amazon account-holders to use their payment info as they shop on their PCs and mobile devices on different commerce sites and apps.
  • Is disruption still possible?: Yes. Take near-field communications, or NFC — uptake has failed to impress. Now, Apple’s Bluetooth-powered iBeacons technology may challenge NFC head-on.

The report is full of charts and data that can be easily downloaded and put to use.

The full report:

To access BI Intelligence’s full report on Mobile Payments, along with BI Intelligence’s in-depth coverage of the mobile, social, payments, video, and e-commerce industries, sign up for a free trial subscription here.

Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.

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