Mobile payments accelerating, despite fragmented approaches

After years of disappointing forecasts, research firm Gartner is decidedly more optimistic about mobile payment technology adoption in a forecast published in late May 2012.

By the end of 2012, worldwide mobile payment transaction values will top $171.5 billion, a close to 62 percent increase from 2011 values, Gartner predicts. By the end of that period, there will be approximately 212.2 million mobile payments users compared with 160.5 million at the end of 2011, the firm said.

During the forecast period from 2011 to 2016, Eastern Europe will realize the fastest growth. The United States will rank third in mobile transaction value at the end of the period, after Asia/Pacific and Africa.

The landscape for mobile payment solutions will be highly fragmented for the next two years, Gartner predicts. That means any retailer or business that is interested in accepting mobile payments must tread carefully when choosing which system to embrace.

"There will be a few global players that have the scale and resources to serve large customers and the mass market whose requirements can be readily satisfied by standard solutions," said Gartner analyst Sandy Shen, in a statement. "However, there will always be segments that cannot be sufficiently served by the global players. The demand of these segments can be satisfied only by specialized or local players who can better understand the segment and have specific solutions to meet the unique challenges."

Among the transaction methods that Gartner believes are worth evaluating:

• SMS-fueled solutions will remain the dominant technology for developing markets.
• Web/WAP approaches will dominate North America and Western Europe; by 2016, solutions that communicate via the mobile Internet will account for 88 percent of the U.S. market.
• Near Field Communications (NFC) will be a tougher sell, because solutions using NFC involve a behavioral change on the part of both consumers and the companies that stand to benefit such as banks, mobile carriers, card networks and merchants.

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• Visa In2Pay: payments on-the-go, using your smartphone
• Square brings swiped credit card transactions to your smartphone; aims for small business

Photo: Courtesy of Verifone

This post was originally published on Smartplanet.com