Mobile payments industry to thrive

Mobile payments industry to thrive

The trend for payments via alternative means is set to continue despite integration challenges

Payments via mobile phone and contactless cards are becoming increasingly popular and the industry expects further growth, according to research.

The study carried out by consultancy Oliver Wyman polled 30 companies in the advanced payments industry. More than half (57 per cent) of the respondents expect to see strong growth for payments made via alternative means over the next year.

Factors driving the fast development of the sector include the increasing sophistication and cost effectiveness of the technology involved, said the survey.

The use of near-field communications technology through mobile phones will play an important role in the payments industry but implementation will take longer to evolve as it requires collaboration between banks and telecom operators.

“Europe’s fragmentation [of the payments industry] means a lot of ‘pretenders’ are pursuing a niche strategy at present focusing on a particular geography, proposition or customer segment, and to a certain extent it’s land grab time,” said Oliver Wyman’s senior partner Zilvinas Bareisis.

“But players in the industry will need a sophisticated strategic marketing capability, a workable business model and clear approaches to interoperability,” he said.

“The winners will be those who can break out of their segments and constraints.”