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Views
Insider's report on payments
This puts into perspective a recent consumer survey by the
British firm Consult Hyperion Ltd. It revealed that nearly
It'll be a slow rise for two-thirds of Americans are dubious about using mobile
wallets for payments. Age is a factor, possibly gender, too.
mobile payments Among men between the ages of 25 and 34, for example,
the split on mobile wallet acceptance was 50-50. Among
women between the ages of 45 and 54, 78 percent said they
would never use mobile wallets, the consultancy reported.
By Patti Murphy
ProScribes Inc. Here is another potential roadblock: many consumers
who use smartphones to make payments are encountering
here's been plenty of hype about the impact of problems. A survey by Jumio, an online verification and
millennials on society in general and on payments payment platform, revealed that 68 percent of consumers
in particular. This latest generation of adults is with smartphones or tablets have attempted to use those
T a huge demographic with potentially trillions of devices at the POS, yet 66 percent of that group reported
dollars a year in buying power. Millennials also have an being unable to complete those transactions because of
affinity for mobile technologies, so some observers expect obstacles at the checkout.
they will drive mobile payment adoption.
Global prospects (somewhat) brighter
But the economic power of millennials is far from
mature. Thus, even if mobile payments take off with this Prospects for mobile payments seem brighter globally. The
demographic, such payments will remain on the fringe for international consultancy Berg Insight AB forecasts 1.2
many years to come. billion mobile money users worldwide by 2017, up from
323 million in 2011. This is because in many emerging
markets (especially in Africa and Asia) mobile phones are
The undeniable fact is that baby boomers are in the
economic driver's seat these days. They account for about being leveraged to connect tens of millions of unbanked
half of all consumer packaged goods spending, according adults to the financial mainstream.
to The Nielsen Co., which also expects boomers to control
70 percent of all disposable income in the United States In 2011, about 61 million adults were using mobile devices
within five years. to send and receive payments throughout emerging
markets. Berg Insight expects that number to grow to 381
Boomers retain economic clout million by 2017.
Meanwhile, despite the massive hit to generational net M-Pesa, a joint venture between British telecom giant
worth experienced by boomers following the 2008 market Vodafone Group PLC and the Kenyan communications
meltdown, those 55 and older today control nearly 75 company Safaricom Ltd., is perhaps the most successful
percent of overall wealth in the country, according to the mobile money initiative. As of 2012, 83 percent of the adult
Economic Policy Institute. Americans between the ages of population in Kenya used M-Pesa to move about $8 billion.
45 and 65 also dominate new business creation and drive M-Pesa allows consumers to deposit, send and receive
significant business spending. payments, as well as access cash. It uses short message
service (SMS) technology, rather than more complex
On the other hand, "Millennials are having a tough time technologies like near field communication. M-Pesa
of it," the consultancy Market Platform Dynamics observed reported its transaction growth rates exceed 40 percent a
in a recent white paper, Payments Innovation and the Use of year.
Cash. The unemployment rate among Americans between
the ages of 18 and 35 is higher than for any other generation, The most successful mobile payment initiative to date, also
the paper noted. SMS-based, has been in the Philippines, a country the GSM
Association dubbed "the texting capital of the world," and
So "even if millennials develop a new way of paying at the where, according to the World Bank, only about one in five
point of sale, it won't likely have much of an impact right households have bank accounts.
away – they just don't have the spending power as a group
to shift payment methods as a percentage of spending, Cool is not always practical
which is what drives overall change."
There's no denying that mobile technologies are cool. But
they are not always practical. Consumers have been quick
Over time these consumers will advance in their chosen
fields of work (increasing disposable income), marry, have to adopt mobile communication options because mobile
children or increase spending in other ways. "But that's not devices make communicating faster, easier, more robust
going to happen all at once, and not much of it is going to and cheaper.
happen even over the next decade," the paper stated.
28
Insider's report on payments
This puts into perspective a recent consumer survey by the
British firm Consult Hyperion Ltd. It revealed that nearly
It'll be a slow rise for two-thirds of Americans are dubious about using mobile
wallets for payments. Age is a factor, possibly gender, too.
mobile payments Among men between the ages of 25 and 34, for example,
the split on mobile wallet acceptance was 50-50. Among
women between the ages of 45 and 54, 78 percent said they
would never use mobile wallets, the consultancy reported.
By Patti Murphy
ProScribes Inc. Here is another potential roadblock: many consumers
who use smartphones to make payments are encountering
here's been plenty of hype about the impact of problems. A survey by Jumio, an online verification and
millennials on society in general and on payments payment platform, revealed that 68 percent of consumers
in particular. This latest generation of adults is with smartphones or tablets have attempted to use those
T a huge demographic with potentially trillions of devices at the POS, yet 66 percent of that group reported
dollars a year in buying power. Millennials also have an being unable to complete those transactions because of
affinity for mobile technologies, so some observers expect obstacles at the checkout.
they will drive mobile payment adoption.
Global prospects (somewhat) brighter
But the economic power of millennials is far from
mature. Thus, even if mobile payments take off with this Prospects for mobile payments seem brighter globally. The
demographic, such payments will remain on the fringe for international consultancy Berg Insight AB forecasts 1.2
many years to come. billion mobile money users worldwide by 2017, up from
323 million in 2011. This is because in many emerging
markets (especially in Africa and Asia) mobile phones are
The undeniable fact is that baby boomers are in the
economic driver's seat these days. They account for about being leveraged to connect tens of millions of unbanked
half of all consumer packaged goods spending, according adults to the financial mainstream.
to The Nielsen Co., which also expects boomers to control
70 percent of all disposable income in the United States In 2011, about 61 million adults were using mobile devices
within five years. to send and receive payments throughout emerging
markets. Berg Insight expects that number to grow to 381
Boomers retain economic clout million by 2017.
Meanwhile, despite the massive hit to generational net M-Pesa, a joint venture between British telecom giant
worth experienced by boomers following the 2008 market Vodafone Group PLC and the Kenyan communications
meltdown, those 55 and older today control nearly 75 company Safaricom Ltd., is perhaps the most successful
percent of overall wealth in the country, according to the mobile money initiative. As of 2012, 83 percent of the adult
Economic Policy Institute. Americans between the ages of population in Kenya used M-Pesa to move about $8 billion.
45 and 65 also dominate new business creation and drive M-Pesa allows consumers to deposit, send and receive
significant business spending. payments, as well as access cash. It uses short message
service (SMS) technology, rather than more complex
On the other hand, "Millennials are having a tough time technologies like near field communication. M-Pesa
of it," the consultancy Market Platform Dynamics observed reported its transaction growth rates exceed 40 percent a
in a recent white paper, Payments Innovation and the Use of year.
Cash. The unemployment rate among Americans between
the ages of 18 and 35 is higher than for any other generation, The most successful mobile payment initiative to date, also
the paper noted. SMS-based, has been in the Philippines, a country the GSM
Association dubbed "the texting capital of the world," and
So "even if millennials develop a new way of paying at the where, according to the World Bank, only about one in five
point of sale, it won't likely have much of an impact right households have bank accounts.
away – they just don't have the spending power as a group
to shift payment methods as a percentage of spending, Cool is not always practical
which is what drives overall change."
There's no denying that mobile technologies are cool. But
they are not always practical. Consumers have been quick
Over time these consumers will advance in their chosen
fields of work (increasing disposable income), marry, have to adopt mobile communication options because mobile
children or increase spending in other ways. "But that's not devices make communicating faster, easier, more robust
going to happen all at once, and not much of it is going to and cheaper.
happen even over the next decade," the paper stated.
28
