NFC (near field communication) will become a standard feature on smartphones over the next few years as consumers respond to the convenience of the "mobile wallet" for making payments, according to Mobile Payment: Technologies and Business Models, a new report from Parks Associates.
The firm reports almost 50% of U.S. smartphone owners find an NFC-enabled mobile wallet application appealing. "The convenience of e-Wallet solutions, specifically for eliminating the need to carry multiple or any credit cards, is driving the majority of consumer interest," said Harry Wang, director, mobile research, Parks Associates.
Already 16% of smartphone owners use PayPal or other types of e-Wallet solutions as their preferred method for mobile payments, and one in four Millennials regularly use their mobile phones to research products or services prior to a purchase.
These factors will create a commerce opportunity on smartphones of more than $800 billion U.S. in 2015 and boost business for merchants, retailers, financial institutions, and mobile carriers. Industry heavyweights Amazon.com and eBay reported robust mobile eCommerce growth in 2011. Siemens, which will keynote CONNECTIONS™ Europe, November 8-9 in Amsterdam, recently announced its new walletXpress mobile payment platform.
“We are witnessing a groundswell of activities,” Wang said. “Google recently launched its Wallet app, and Isis, a joint venture between AT&T, T-Mobile, and Verizon, expanded its business model to include more payment partners. Each deal signals serious interest to build scale and technology advantage over competing solutions.”
"The mobile payment space will become less fragmented over time," said Jennifer Kent, Parks Associates' research analyst. “All major players are planning for a converged payments future where one digital wallet can be used across all product categories. Consumers will gravitate toward a single, trusted provider, so development of a reliable wallet with diverse capabilities is crucial."