Gartner Research today published a forecast stating mobile payment users will reach nearly 109M in 2010, representing roughly 2.1 percent of all mobile users.
In Asia/Pacific, for example, mobile payment users will surpass 62.8 million in 2010 and represent 2.6 percent of all mobile users, suggests Gartner. In Europe, the Middle East and Africa, mobile payment users will total 27.1 million and represent 2.1 percent of all mobile users in the region. In North America, mobile payment users will number 3.5 million and represent 1.1 percent of all mobile users in the region.
“We continue to see strong growth in developing markets in Asia, Eastern Europe, the Middle East and Africa for mobile payment, while adoption in North America and Western Europe lags behind due to the plentiful choices of payment instruments that consumers have,” said Sandy Shen, research director at Gartner. “Developing markets have found the right formula for mobile money services — functions that users want and an ecosystem that can sustain the service.”
The growing dynamic of mobile payments in developing markets is interesting, we reported a few weeks back that the Gates Foundation and the U.S. Agency for International Development pledged $10 million in funding to spur the use of cell phone banking and mobile payments to bring financing to the poor and help rebuild the financial ecosystem in Haiti. “The answer for developed markets, however, remains elusive,” Ms. Shen said. “The offerings for developed markets will take a different format. Instead of a point offering for mobile payment, the service needs to be built on top of the existing payment behavior and infrastructure so that users can choose any channel — retail, phone, online or mobile — that suits their context at the moment of payment.”
Many financial institutions have failed to see the business case of Near Field Communication (NFC) for payments, which offers similar functionality to contactless cards but with the added complexity of dealing with mobile carriers and other ecosystem partners. SMS remains the dominant mobile payment technology, however, as its ubiquity and ease of use makes it the technology of choice, not only for consumers in developing markets, but also for those in developed markets. Wireless Application Protocol/Web can support either downloadable clients or mobile browsers, but it’s more frequently used by consumers in developed markets due to the higher penetration of data-capable phones and active data plans.