By Daryl Colwell | @DHColwell | VP, Business Development
Six months ago, mobile payments were on the ropes. Consumers weren’t interested or, worse, didn’t understand the value proposition. Business adoption was at a novel, if less-than-promising, growth stage.
What a difference a few months makes.
Mobile payments, which allow consumers to use their smartphones to make in-store purchases, received a major shot in the arm recently, courtesy of Starbucks’ $25 million investment in Square. The funky start-up, founded by Jack Dorsey of Twitter fame, has created a payment system that allows local merchants to accept credit card purchases with a mobile device.
The mobile wallet is growing up. But is the hype outweighing the consumer value?
The use of mobile wallets and Near Field Communications (NFC) — the technology behind mobile payments — are on the rise. Analysts peg the global transaction value of mobile payments at nearly $1 trillion by 2014, up from $162 billion in 2010, and 24% of all global e-commerce by 2017. By 2015, Forrester forecasts that NFC-enabled handsets will comprise 15% to 25% of all mobile phones in the U.S.
Mobile payments’ future is bolstered by reports that Google now supports all credit and debit cards on its Google Wallet app for Android devices.
With two key factors — ease-of-use and rate of adoption — moving in the right direction, mobile payments may finally reach their lofty potential. But there is still a long way toward mainstream adoption.