Mobile Payments to Hit $998.5 Billion in 2016

Global mobile payment market revenues will raise from $47.2 billi­on in 2011 to $998.5 billion in 2016, according to a study by Canadian-based provider of market intelligence services, IE Market Research (IEMR).

According to a recent IEMR report, mobile payment market revenues are expected to grow at a CAGR of 83.7 percent between 2012 – 2016. The forecast is based on the mobile payment transactions by technology and mobile payment transactions by type of purchase trends. The company forecasted the report based on Global Consumer Telecommunications Survey covering 50,000 mobile users in 50 markets globally.

“Globally, we are expecting mobile payment revenue to rise from $47.2 billion in 2011 to $998.5 billion in 2016. Compound Annual Growth Rate (CAGR) from 2012 to 2016 will be 83.7%,” said Nizar Assanie, Vice President (Research) at IEMR. “Among different categories of mobile payment, we expect that digital purchases will be the largest category with its revenues increasing from $9.8 billion in 2011 to $250.9 billion in 2016.”

IEMR predicts more service providers, including telecom operators, banks, and retailers, will introduce mobile wallet payment solutions in the near future. M-commerce and cashless mobile transactions will be a global phenomenon by 2016.

“Our usage surveys show that North American and Western European markets in particular are geared up for the beginning stages of a full-fledged adoption of the digital wallet,” said Assanie.

Both consumers and suppliers will continue to benefit from the mobile payment approach.  While Google wallet and Isis are currently the hot topics in mobile payment trends, more players are gearing up to start their own payment systems.  Companies like PayPal, mopay, and eBay are introducing their mobility systems into the market. PayPal in partnership with Home Depot is planning to venture on a mobile wallet paradigm.

While mobile payment system continue to grow, security research firms are concerned about the security issue that consumer will face over mobile payment. Recently, a security research team from Zvelo discovered loop holes in the default PIN storage used by Google Wallet payment system. They discovered that an attacker can easily take ownership of the mobile device while a payment transaction is in progress, accessing the secure PIN on the device itself.

The mobile wallet is here to stay. The current NFC technology might have some drawbacks, but we can expect that the future NFC and other mobile payment apps will have much more security features to prevent hackers and other privacy concerns.