Will the phone ever replace the wallet? New research suggests it could, with 18 per cent of shoppers saying they have used their phones to pay in a shop.
This is one of the key findings of global trade body Mobile Ecosystem Forum’s annual Mobile Money Report supported by Wirecard. It asked 6,000 consumers in nine countries about their attitudes towards mobile payments.
The 18 per cent figure reflects a big spike in ‘physical’ mobile transactions. Two years ago, just eight per cent had completed an in-store payment with a handset. Apple Pay is one obvious reason for this upturn. Now available in 13 countries, the service has greatly improved awareness of the mobile wallet.
But the biggest impact has come from China. The research reveals 38 per cent of Chinese consumers have made an in-store mobile payment - nearly double the global average. This is thanks to mobile wallets such as Tencent/WeChat and Alipay. Their users frequently make QR-code based payments with these products in physical stores.
While in-store mobile payment gathers momentum, mobile shopping on apps and sites has gone fully mainstream. The study found 78 per cent of people had made a purchase by mobile in the previous six months - that’s up four per cent on the figure for 2014.
Mobile banking has enjoyed a similar journey to the mass market. 61 per cent of respondents say they now use their mobile phone to bank, with 44 per cent using apps to check their balances (28 per cent in 2014), and 29 per cent paying bills from the handset (against 20 per cent in 2014).
The research reflects the widespread migration of banking in many mature markets from the high street to apps. In fact, 28 per cent of respondents say they prefer branches against 26 per cent for apps.
Despite the general good health of mobile payment, banking and commerce, the old hurdles remain. Cart abandonment is still high, for example. The research reveals 58 per cent of people have started to pay for something via mobile, only to abandon it before checkout. 31 per cent said this was because they were asked for too much sensitive information, while 21 per cent said the process was too long.
Christian von Hammel-Bonten, Executive Vice President Product Strategy at Wirecard, said: “"Today, consumers use smartphones to manage their entire lives: to play games, chat, check their finances, purchase products and order services. Chinese users are at the forefront of this ongoing trend. This comes at no surprise as we enable our customers from the beginning to benefit from this trend with our financial solutions. Yet the report shows also the whole ecosystem still needs to improve and that is what we are working on with MEF and its partners."
Rimma Perelmuter, CEO at MEF said: “The adoption of mobile money continues to advance. In developed markets, mobile payments and banking are driving a revolution in convenience. In growth markets, they are giving millions of people access to financial services for the first time.
It’s important that the industry builds on this momentum. The research shows we can still do more to improve payment flows, improve consumer trust in mobile money to allay privacy and security concerns. But overall, the news is good: mobile remains the key driver of online commerce.”