Are We About To See The Rise Of Proximity Payments?
It’s pretty clear that mobile payments are on the rise. What you might not know is what types of mPayments are poised to gain supremacy.
According to a new report from Forrester Research, proximity payments – or payments made in a physical store – are set to take off over the next five years, growing from 4 percent to 45 percent of all mobile payments by 2017. That marks a 137 percent compound annual growth rate, with exceptionally fast growth in 2014 and 2015, notes Mobile Commerce Daily.
One reason for such growth? Forrest expects NFC to expand over the next several years, enticing users with value-added functions and eventually gaining mainstream adoption.
In addition to proximity payments, the study looked at mCommerce payments and mobile remittances, which together comprise the mPayments industry. Overall, the study expected mobile payments to grow to a $90 billion industry by 2017.
So if proximity payments are expected to eat up a huge share of the mPayments market, which method will subsequently regress?
According to Forrester, that would be mCommerce, or standard online purchases made via a phone or tablet. While mCommerce currently holds 90 percent of the mobile payments market share, Forrester expects it to drop to 50 percent by 2017. That means that in five years, mobile commerce would be a $45 billion industry, while proximity payments would be close behind at $40.1 billion.
Mobile remittances and peer-to-peer payments are also expected to grow, but at a slower rate. Forrester expects mobile P2P to rise from $1.2 billion next year to $4.2 billion in 2017.