The Mobile Wallet Ecosystem
When, and how will mobile payments in the US catch up with the rest of the world?
Imagine a world where you can make payments using your phone or your watch everywhere you go: restaurants, shops, food trucks, the subway, farmer’s market. This isn’t the future; it is plainly how people make their everyday purchases in countries like China and the UK today.
All that activity — day-to-day purchases, exchanging of monetary gifts, and even more complex banking transactions — generates an enormous amount of data that payment companies and brands can use to create better products and shopping experiences. In-store experiences therefore contribute to, and benefit from a larger digital retail ecosystem. Small businesses may see an increase in sales by integrating and increasing incentive programs, being less cash-dependent, tracking customer trends and inventory, increasing check-out speed, and saving money on credit card fees.
A single US credit card transaction costs more than 4 times of that for WeChat or AliPay, the ubiquitous mobile payment solutions in China. However, it’s still somehow strange to pay with your mobile devices in the US, where mobile payments make up less than 1% of overall in-store transaction volume. The growth of mobile payments in the US can only accelerate and scale in the future.