Emerging markets are the major adopters of mobile payments
With the second year anniversary of the Apple Pay roll-out this month and as we gather more data on mobile payments usage, some unexpected trends are evolving.
Mobile payments thriving in the BRICs and other emerging markets
Regardless of the high profile launch of Apple Pay in the Americas, the BRICs (Brazil, Russia, India and China) are witnessing far more prosperous mobile payment levels. This is despite customers and businesses experiencing limited access to financial institutions, latest technology and banking services.
Let us take India, for example. A recent report by GrowthPraxis showed that the mobile payments market in the country grew more than fifteen times between 2012 and 2015 to reach its current size of USD 1.4 billion.
Moreover, in China, 68 percent of online shoppers purchased via mobile in 2015, the highest percentage in the world. Turkey, another emerging market according to the International Monetary Fund, has the third highest percentage globally.
Chinese New Year drives P2P
Across the world, consumers are more frequently sending money to each other through peer to peer (P2P) payments. In Europe and the Americas the most popular vehicle to these payments is mobile banking, often used to split bills. As a result, P2P payments will see the most growth in Asia Pacific, where sending electronic money has become a cultural norm, particularly for the Chinese New Year.
In China, it is customary to hand out money-filled red envelopes called hongbao to friends, family and colleagues. Now, such traditions have taken a digital edge, and users can directly transfer money through WeChat or Alipay, WeChat being the more popular of the two for P2P payments.
App payments will see most global growth
Despite Apple’s launch of mainstream proximity payments, m-commerce is the area expected to grow the most. M-commerce refers specifically to payments completed via a mobile app or browser. With the rise of service-driven apps like Deliveroo and Uber, where geolocation is key, usage slips between mobile and real world. Such in-app payments have exploded in popularity and for this reason this area is expected to see the most growth by 2019.