April 5 — By 2019, almost 2.1 billion consumers worldwide will use a mobile wallet, up nearly 30 percent from the 1.6 billion users recorded in 2017.
A new study from Juniper Research, Basingstoke, U.K., found that while contactless card payments were in greater use than near field communication mobile payments in many markets, leading mobile wallet companies were seeking to address the imbalance by enabling both online and offline options.
A number of wallets, such as France’s Orange, have augmented payment offerings with banking services in a bid to deliver a holistic financial portfolio for consumers.
Juniper’s Mobile Wallets: Service Provider Analysis, Market Opportunities & Forecasts 2018-2022 assessed the capabilities and prospects of nearly 20 leading mobile wallet companies. Findings shows that PayPal, which has started offering contactless instore payments in the U.S., has the greatest opportunities to develop a converged wallet on a worldwide basis. Next in line is Alipay, based in China followed by Weixin Pay/WeChat Pay.
However, the findings support that idea that while QR code-based instore payments have seen astonishing levels of adoption in some countries like China, successful use cases in Europe and North America will likely be limited to “closed loop wallets.” (One such example is the Starbucks payment app.) This is despite the fact that research shows consumers and merchants alike find NFC-based wallets an attractive payment option based on the greater security offered by tokenised credentials and biometric authentication possibilities.
“QR code-based payments are likely to have significant growth in markets such as Indian and sub-Saharan Africa, due to negligible implementation costs,” said research author Windsor Holden. “However, their greater susceptibility to alteration to include viruses and phishing scams is likely to act as a major deterrent elsewhere.”
Looking for more information on mobile wallets? Check out Juniper’s whitepaper, NFC vs QR Codes — Which Wallet Wins?