Mobile payment is witnessing a healthy growth around the planet. However, countries endowed with more fleshed-out credit card networks have been astoundingly lagging behind with a relatively slow and fragmented rate of growth. The United States (US) is one of the countries that have garnered a low usage rate in 2017. This year, nonetheless, the adoption of mobile payment is expected to receive a boost as several service providers are reacting.
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What is a modern mobile wallet?
A mobile wallet is a mobile application where consumers can not only verify their financial accounts or make payments but also store and organize coupons, loyalty programs, payment cards, tickets, car-insurance identification or other digital items. There exist several mobile wallets and certain tout other features such as bill payment and person-to-person (P2P) payments functionality.
The US lagged behind in the adoption of mobile wallets
According to the “Global Consumer Survey: Consumer Trust and Security Perceptions” report conducted by ACI Worldwide and the Aite Group, several countries around the world, such as Brazil, Mexico, China, and India, witnessed a rise in the use of mobile wallets, starting from 2016. However, countries having solid credit card networks such as the US, the United Kingdom, and Canada saw a relatively slower growth. However, countries that already had entrenched credit cards networks, like the USA, the United Kingdom, and Canada, saw a much slower growth than countries.
2017 can be summarized as a quiet year for mobile wallets in the US. The lethargy on behalf of consumers can be explained by two principal reasons. Firstly, consumers satisfied with the existing card-based payment systems consider that same is easier and secure to continue using. Secondly, the mobile wallet providers themselves have been delaying in providing high-end mobile apps, education about the services, and implementation at point-of-sales to urge customers to embrace mobile payment. As a result, consumers simply did not see why they should ditch the card-based payment for an unsure mode of payment.
Mobile wallet providers are innovating to reach the mass
Conscious of their crucial role in reaching the critical mass for widespread success, several mobile wallet providers are hustling to provide more.
This year, several service providers are expected to compete with each other to stay ahead of the curve. Most have understood that they need to provide much more than a simple mobile payment app. The app should be endowed with a panoply of innovative and convenient proximity-based features too. For example, this approach is one of the characteristics that make Alipay and WeChat successful in the Far East: both services providers offer users the ability to do much more than just pay for goods and services.
In the US, Wal-Mart Stores Inc.’s app is aiming at surpassing Apple Pay in usage for mobile payments in the U.S. Daily, Walmart Pay which is available in about 5,000 stores, is registering thousands of new users.
Barclays and Wells Fargo each introduced Android-based mobile wallets not to lag behind in the mobile payment trend. MasterCard, Visa, and PayPal, on their side, have announced that they are going to bring some impactful changes this year in terms of mobile payment. LG’s payment system should also be this year in the US.