5 Observations about Mobile Payments

By Michael Lynch, Chief Strategy Officer July 23, 2018


While the concept of making payments without physical currency has existed for a long time, the promise became a fast-moving reality with the global proliferation of mobile devices. Now, aided by the technology, banking and payment services are rapidly expanding all over the world. And while the field of mobile payments is still a relatively new one, some key trends are clearly emerging.

1. The Adoption of Mobile Payments is Rising

According to Business Insider, in the U.S. alone mobile payments volume will increase to $503 billion by 2020 and will be used by 56% of the consumer population during that year[1].

2. An Evolution in Consumer Engagement is Taking Place

Engagement with consumers has changed from organizations broadcasting to a mass audience to targeting specific audiences. Targeted engagement relies on the use of data to understand what customers value and leverages digital intelligence. Engagement done in this way delivers timely, relevant, and contextual content to receptive audiences.

3. On-Demand Commerce is Vital for the Connected Consumer

Effective marketing for connected consumers allows for the immediate purchase of goods and services and helps shape the experience itself through the use of personal connections and social media. To perform well, this commerce must span all online channels and be integrated.

4. Attributes of the Customer Experience are Converging

In the new payments environment, the trust underlying transactions is shifting from customers to their associated devices. The most innovative environments also offer integrated payment options and feature embedded loyalty programs.

5. New Opportunities Abound, But Bring New Risks

This unveiling of vast troves of data and unprecedented access to customers creates efficiencies for customers and merchants, but also raises concerns about security and potential fraud. Surveys consistently indicate concerns over security are customers’ primary hesitation in using mobile wallets.

This concern is justified as approximately 112,000 mobile wallet-related accounts were compromised in 2015 when the user base was only 23 million[2]. Experts predict account compromises could rise as mobile payment adoption increases unless new security measures are put in place.

To counter the predicted fraud, commerce providers will need to enhance their security capabilities by employing multiple layers of authentication. Key to this strategy is utilizing the digital intelligence elements provided by the devices consumers use to transact with.

InAuth is a digital intelligence expert, analyzing devices and associated identities to ensure trust with those interacting within your digital channels. We help business verify identity, assess and mitigate risk, optimize the customer experience, and improve operating processes and reduce risk. Visit us at www.inauth.com.

[1] Business Insider, The Mobile Payments Report, June 2016

[2] Javelin, Mobile Wallet Fraud: This is Just the Beginning, June 2016

About the Author

Michael Lynch is InAuth’s Chief Strategy Officer and is responsible for developing and leading the company’s new products strategy, as well as developing key US and international partnerships. He brings two decades of experience in key roles within financial services, consulting, and Fortune 500 companies, specializing in security and technology leadership.