Will Mobile Payments Overtake Credit? What Your Business Needs to Know.
Written by: Colby Ring
A successful business actively sells what they believe is the best product or service currently available. A successful business with longevity is also focused on innovating the next best product to meet their customers’ needs. Visionary companies see what is coming down the road in technology and consumer demand, anticipate the solution, and develop the best, most sustainable product. FTNI keeps a keen eye on the future and a finger on the pulse of the expectations within the business, consumer and financial services sectors.
Forrester estimated that only 4 million new shoppers were added to the ranks of the online shopping in 2013. Growth in online shopping is steadily increasing, and there is also an increasing use of internet connected mobile devices. According to Forbes, the use of mobile devices to make payments has tripled since 2012 and should increase 48% by 2017. There is an expectation that 1.5 billion people will adopt internet connected mobile devices and at least 50% of them are already comfortable with using their device to make payments.
What does it all mean?
It means that mobile payment options are fast becoming a preferred method of payment and companies that want to have quick payment cycles need to adopt mobile payment technology. It is such an important factor in the future of payments, leading companies are actively adopting mobile payments into their existing landscape of payment options – whether they are B2B or B2C.
Although mobile devices are expanding rapidly in adoption and the use of mobile payment systems is expanding, there is still a great demand for in-person transactions. Studies, such as one from TransactionAge, have shown that trust and adoption of mobile payments remains highly segmented by socio-economic position. Lower wage earners are still using in-person processes to make payments because of the inability to afford a mobile device, trust issues of the financial services world, and lack of a bank account.
Another interesting prediction is the continuing decline of credit card usage. Credit card usage with on-line payments dropped four percent between 2009 and 2010, but during the same time alternative payment options rose. Consumers are growing weary of entering long strings of credit card numbers into text fields because of inconvenience and security fears.
The decline of credit card use is contributing towards the adoption of mobile payments, virtual wallet software and product development. Because of the varied needs for payment methods to accommodate all customers, businesses need flexible payment systems that enable them to adapt to the ever changing consumer payment practices in the market.
FTNI’s ETran platform embraces some of the predictions McCune makes and industry analysts are predicting. Payment flexibility is necessary: business owners have to be able to accept walk-in, online and mobile payments alike. ETran provides that wide range of payment flexibility for businesses, as well as ability to integrate seamlessly into other back office and accounting systems.