Consumers Take Control in the Wallet Wars

A new generation of mobile wallets is emerging to evolve wallets beyond payments, Thales SVP Gustavo Menezes writes in the new PYMNTS eBook, “Headlines That Will Shape the Close of 2025.”

Mobile wallets are now firmly established as a mainstream consumer choice for in-store payments. And as 2025 draws to a close, a new wave of innovative third-party wallets is fueling even faster growth of convenient, phone-based, tap-and-go transactions.

The numbers speak for themselves. In 2024, research showed that 17% of U.S. consumers used mobile payment for their most recent in-store transaction. Compared to countries such as Japan, where the figure is 34%, that’s still relatively low. However, in the U.S. — and around the world — adoption is on a strong and sustained upward curve.

So far, the mobile payment revolution has been driven largely by OEM wallets such as Apple Pay, Google Pay and Samsung Pay. For several years, new entrants struggled to gain traction. Apple’s NFC interface (the technology that enables tap-and-go payments) was locked to Apple Pay. While Android allowed third-party wallets, early issuer solutions were not sufficiently distinct from banking apps and lacked clear incentives for consumers to switch.

So what’s changed? In Europe, a landmark regulatory decision in 2024 opened Apple’s NFC capabilities to third-party apps. For the first time, banks, FinTechs and domestic schemes could offer tap-to-pay experiences with iPhones. In Norway, Vipps led the way, becoming the world’s first third-party app to enable NFC payments on iPhone in December 2024 with the support of Thales. The response has been extraordinary: more than 1 million bank accounts were digitized in the first four months. In Germany, PayPal followed quickly, launching its own NFC wallet this summer.

Innovation is equally strong in the U.S. In particular, a new generation of wallets is emerging that offers consumers more than just fast, secure, contactless transactions. The Starbucks app, for example, integrates loyalty, mobile ordering and payment. As of early 2024, over 30% of transactions in U.S. company-operated stores were made via the app — up from 25% just two years earlier.

Meanwhile, in Latin America, Mercado Pago is also demonstrating how to build a successful mobile wallet offer. In 2024, the payment service company’s app attracted over 60 million active monthly users. Deep integration with the Mercado Libre online marketplace, strong brand trust and compelling in-store rewards are all driving growth. Instalment financing and merchant discounts add further value for customers.

The increasingly open mobile wallet ecosystem is evolving beyond payments and creating exciting opportunities for a wide range of enterprises and organizations. Reflecting this, branded and closed-loop wallets from retailers, national schemes and transit systems are now competing on engagement as well as convenience. And as competition flourishes, consumers are becoming more discerning, and more powerful. The wallets that thrive will therefore be those that embed themselves in everyday life — providing not just a seamless means of payment, but also a bridge for building valued relationships.