Google Wallet, Isis, NFC Will Push Mobile Payments to $1.3 Trillion
Mobile-payment transactions are expected to rise nearly fourfold over the next five years, exceeding $1.3 trillion, according to a new report from Juniper Research.
The research company expects sales using remote purchasing and near-field communication (NFC) technologies to be the primary drivers of the growth. Encouraged by the increased engagement of the wireless carriers and increasingly widespread rollout of NFC infrastructures, by 2017 these two types of transactions are expected to account for 54 percent of the total value of the mobile payments market.
And still, the purchase of goods over mobile phones will account for only 4 percent of global retail transactions by that date.
The report takes note of a number of recent efforts-such as Google Wallet and a joint venture by Verizon Wireless, AT&T and T-Mobile called Isis-that together mark a "tipping point," but says much more still needs to be done.
"While we are now seeing significant deployments of contactless infrastructure, consumer awareness is extremely low," report author Windsor Holden said in an Aug. 16 statement. "Thus, it is imperative for all members of the NFC value chain to engage with the public to heighten its profile of a simple, intuitive payment mechanism."
Discover, doing its part, announced the same day that it had partnered with Google, enabling card members to use the Google Wallet application to pay for items using their Discover cards.
Card members can add their card to their NFC-enabled phone through the Google Wallet app, through their Google account online or through the Discover site.
"By providing a simple way for cardholders to securely add their credit card to Google Wallet directly from the Discover Website, we're extending the opportunity to pay with Discover through Google Wallet at hundreds of thousands of merchants," Robin Dua, Google Wallet's head of product management, said in a statement.
On Aug. 1, Google announced the addition of new security features to Wallet, technical changes to the way it stores card information, and support for all credit and debit cards from Visa, MasterCard, American Express and Discover.
American Express, however, took exception to the announcement, clarifying that while it is interested in Wallet, it has yet to reach a formal agreement with Google.
"We want to make sure Google's mobile wallet product meets the standards we set for our Cardmembers in terms of the transparency and clarity about transaction detail," the company told eWEEK. "Right now, American Express does not have an agreement with Google for our cards to be used in the Google mobile wallet."
Despite such hiccups, the market marches onward.
Discover, American Express and Google, along with industry peers such as PayPal, VeriFone, Intuit, Capital One, Isis, Visa and MasterCard, earlier this month joined a Mobile Payments Committee formed by the Electronic Transactions Association. The lot plan to work together to educate everyone from merchants and consumers to lawmakers about the possibilities, challenges and future of mobile payments.
"As a nascent industry, the mobile payments market is just beginning to realize its full potential as a robust enabler of global electronic commerce," Committee chairperson Jackie Moran said in an Aug. 9 statement.
"The Mobile Payments Committee is designed to ensure that the early stages of mobile payments are handled in the best-possible way, with insight and ingenuity from all the players."