The global mobile wallet market size was valued at USD 592.45 billion in 2015. The service saves the consumer payment credentials and makes them available at the Point of Sale (POS) to enhance the customer experience. The technology serves the dual purpose such as financial management and transfer of funds services. The payment technologies have undergone significant change with the introduction of NFC and mobile wallet services coupled with the integration of POS terminals and mobile devices.
Global Mobile wallet Market, 2014 - 2024 (USD Billion)
The key players are collaborating with banks, technology vendors, and payment service providers to develop the required infrastructure for enhancing the consumer experience. Furthermore, Value Added Service (VAS) has been acting as an enabling force driving the industry demand and cashless payments. The key players in the market have introduced value-added features in their offerings to differentiate the business from the competitors. Some of the features include mobile vouchers & services, digital loyalty schemes, dynamic currency conversion, real-time fraud screening, and a digital charity box.
Lack of privacy and security threat over the mobile payments might result in affecting the segment demand. The lack of government regulations for governing the cashless payments also expected to restrain the industry demand over the forecast period.
Remote mobile wallet segment has generated the highest revenue in 2014 and is expected to maintain the dominance throughout the forecast period owing to the ability to access the cashless payment through the communication networks.
Proximity product type is expected to have the highest growth rate over the forecast period with the increasing penetration of NFC enabled smartphones across all the regions. The product flexibility for converting the devices to NFC-enabled is expected to lead the growth.
The application segment can be categorized into the restaurant, retail, vending machine, and public transportation. The retail application is estimated to dominate the business in terms of revenue in 2015. The proliferation of smartphones and increasing need for better consumer experience is expected to propel the demand.
The ability of a vending machine to make cashless payment provides an opportunity for consumers to pay contactless and hence encourages the consumer for purchasing frequently. NFC integrated devices offer better consumer experience with secure payment methods and encourage the retailers to incorporate the technology. Increasing usage of vending machines in emerging countries like India, Indonesia, and China are expected to improve the demand for the application segments.
Retailers are increasingly gaining the potential benefits of accepting transactions using the mobile wallet. The retailers incorporating the cashless payment technology with digital marketing are envisioned to attain consumer data opportunities and loyalty. Furthermore, low processing fees and faster check out through the NFC technology are also expected to achieve cost and operational efficiency. The technology helps the retailers in offering special promotions and in tracking the loyalty rewards for improving the relations to mobile customers.
The Asia Pacific region is expected to remain the key revenue-generating region, accounting for the highest share by 2024. Favorable consumer preferences along with the presence of a large number of service providers in the region are few factors accounting for the significant growth. The transitions from analog to digital systems are also anticipated to be one of the factors for growth over the forecast period. Increasing demands from countries such as China and India owing to changing consumer needs and disposable income are also expected to witness significant growth over the forecast period.
Furthermore, government-driven initiatives such as Make in India and Digital India in the country are anticipated to boost the penetration of smartphones and other consumer electronics resulting in the growing demand for the industry.
The European market is expected to witness major developments in various applications which include NFC-based transactions, ticketing, and access control over the forecast period. The rising number of NFC tags implementation in the industry has led to the increased use of NFC readers. Public transportation and restaurant application segment are accounted for the major share of the overall European market.
The industry players are constantly investing in R&D to develop the innovative payment platform for developing the new improved technology and gaining the market share. The key industry competitors include Apple Inc (U.S), American Express Company (U.S), Alipay (China), Bharti Airtel Limited.
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