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09.07.17

Report: Mobile Wallets Reach ‘Tipping Point’

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This week Apple Pay celebrated its third birthday, and ACI Worldwide and Aite Group released data on rising mobile wallet usage, indicating that consumers in the U.S. and Europe are starting to catch up with those in Asia and Latin America where mobile wallets dominate.

The research, which is based on online surveys of 6,035 consumers in 20 countries, shows that 17 percent of U.S. consumers now regularly use their smartphones to pay, up from 6 percent in 2014, when the survey was last conducted. In Europe, Spanish consumers are the most active mobile wallet users, with 25 percent using them regularly, followed by Italy (24 percent), Sweden (23 percent) and the U.K. (14 percent).

“What we are seeing is a tipping point regarding adoption, which can be attributed to consumers worldwide now almost exclusively using payment-enabled devices, as older models have cycled out, with a few exceptions,” says Mark Ranta, head of digital banking solutions, ACI Worldwide.

India tops the list of countries surveyed, with 56 percent of consumers saying they pay with a smartphone regularly, followed by Thailand (51 percent) and Indonesia (47 percent). As widely predicted, these markets are leap-frogging traditional card infrastructure and usage patterns and are very mobile-oriented.

Although consumer confidence regarding mobile wallet security remains high, the report cautions that the uptake in mobile wallet usage could invite more attention from fraudsters.

Alphabet Soup

Another important factor in the U.S., according to Ranta, is the ubiquity of mobile wallet acceptance. “With the EMV rollout behind us, most stores are NFC-enabled and the acceptance of mobile wallets is now almost guaranteed by most larger retailers and even many smaller ones.

“And there is of course China, one of the world’s fastest-growing markets and trendsetters when it comes to mobile payments,” he continues. “The Chinese market is dominated by two players Alipay and WeChat Pay. Both schemes use optical scanning QR-code techniques at the point of sale instead of the plastic card industry standards like NFC. QR-code techniques have grown dramatically in popularity over the last five years, on the back of smartphone adoption and the ubiquitous use of social media and digital platforms. These new Chinese payments services are expected to drive new payment behaviors across Asia and globally.”

What’s more, Ranta believes that rollout of immediate payments schemes combined with new regulation in Europe going into effect in early 2018, will only increase the importance of mobile payments.

The study findings are more upbeat than a usage report released earlier this year from PYMNTS.com, which focused solely on the U.S. and found usage rates of Apple Pay, Samsung Pay, Walmart Pay and Android Pay at 5.5 percent or below for those customers with the capability to use the mobile wallets.

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