Yankee Group warns of mobile payments threat to banks

Yankee Group warns of mobile payments threat to banks

Fifty million mobile phone users in the United States will be using their devices to authorise payment for goods and services by 2006, forecasts the Yankee Group.

These 50 million mobile users - representing 17% of the total population and a quarter of all wireless users - will spend approximately $15 billion, purchasing premium content and authorising the purchase of physical goods and services with their handheld devices.

The figures are revealed in a new Yankee Group report, "Mobile Payments: What Are They Worth?".

The $15 billion revenue figure implies that carriers can increase monthly revenues by anywhere from $0.20 to $3.00 in 2006. "We estimate that carriers will win a material share of most transactions," predicts the Yankee Group.

By 2006, mobile commerce will have started to make a dent in the payment mix and will represent approximately 2-3% of all non-cash, electronic transactions, the report projects.

The ability and willingness of carriers to enable micro-billing will represent an expansion rather than cannibalisation of the transaction pie, says the Yankee Group, which warns banks in the existing payment industry to beware: "In the long run, aggressive carriers will leverage their newly acquired experience with micro-payments, expanding their networks and their service offerings from telephony into payments."

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