Mobile Payments is definitely one of the digital services Mobile Operators are making inroads into, hoping to provide subscribers the wallet and payment service which enables subscribers to use their mobile devices, such as the smartphones to make payments for their purchases - be it online or in stores. Coupled with mobile banking, the mobile payment will enable subscribers to withdraw 'money' from their bank accounts and keep it in their Mobile Wallets for payments. Mobile Wallets are expected to host any credit and debit cards as well as a range of other payment mediums including coupons, tickets and even boarding passes. The truly matured Mobile Payment environment promises to replicate the physical wallet on the smart mobile device.
While the whole idea is compelling enough for MNOs to start venturing into these service segment, a recent research by MPayMe, the company behind the global mobile business platform ZNAP™ indicated that the idea of mobile money is not growing as fast as it is expected due to the following reasons:
Payments only - They focus only on payments and not other forms of money and lifestyle management
Fragmented – The solution is often restricted to a single channel, such as online or in-store, which means customers need multiple applications
Parochial - The majority can only be used domestically, unlike most credit and debit cards
Wallet replacement - They fail on the promise of genuinely replacing wallets due to limited functionality
Limited scope - They are almost exclusively aimed at retailers, despite this making up only a very small fraction of the average household spend
According to MPayMe, their survey showed that less than 10% of smartphone users made a point-of-sale payment and only 7.5% of merchants were able to accept mobile payments - based on merchants on Oxford Street, Europe's busiest shopping district.
Hooman Mazaheri, European CEO of MPayMe, explains why the reality is so different to the claims:"With one or two notable exceptions, the biggest retailers and merchants in the UK are slow in adopting this new technology. It's a similar picture for consumers too. The products currently being offered often have too many limitations and don't offer the value or the utility to drive merchant and consumer adoption. When there are already well-established and traditional ways to pay, i.e. cash and cards, what's the benefit of introducing a rival if it doesn't come with added value? "What's needed is a solution that addresses the real and diverse needs of merchants and consumers. Yet another method of payment isn't enough unless it comes with add-ons such as data and loyalty scheme management for merchants, and a relevant, versatile and wider-reaching customer experience for consumers." Source - Payme (Sept 23, 2013)
