Global spending via mobile wallets is expected to rise by nearly 32% this year to $1.35 trillion, a new study from Juniper Research (www.juniperresearch.com) has found.
The study found that spending is currently concentrated in the Far East and China, due primarily to the success of Alipay and WeChat. However, the research says that moves by PayPal and Apple to offer wallets that can be used both in-store and online means that wallets will increasingly become the default payment mechanism in other markets.
The research highlights PayPal’s decision to introduce an HCE (Host Card Emulation) NFC solution to enable POS payments as a key disruptive moment in the wallet wars. According to Juniper Research, this – allied to the burgeoning success of its social payments subsidiary Venmo – places PayPal in pole position to capitalize on the increased demand for mobile wallets.
The research group classified PayPal as the “established leader” within its Mobile Wallets Leaderboard, which provides a comparative assessment of wallet providers including Alipay, Apple, Mastercard, Paytm, Samsung and WeChat. Additionally, the research argued that the implementation of the PSD2 (Payment Services Directive 2) legislation should spur further competition within the European wallet space, with existing players poised to introduce additional services to complement their payment offerings.
However, Juniper Research warned that outside emerging markets, remaining mobile network operator wallet ventures were unlikely to gain traction. According to research author, Dr. Windsor Holden, “network operators remain wedded to offline payments based on an NFC SIM card, at a time when more agile competitors are deploying integrated HCE wallets that also enable online usage.”