Javelin: More US Consumers Are Likely to Use P2P Payments
Javelin Strategy & Research has released a new report - Mobile Person-to-Person Payments: Mounting Telco Activity in a Mobile Channel Segment That Financial Institutions Can’t Afford to Lose - that finds that "financial institutions must act now to implement person-to-person mobile solutions before carriers capture the market."
Javelin says "that conditions are growing ripe for potential widespread consumer use of mobile devices to send payments between one another: smartphones are now used by 17 percent of consumers, mobile banking is used by many, and use of the internet for banking and shopping has been common for years. These are just some of the conditions that have created an increased likelihood that consumers will soon begin to use mobile person-to-person (P2P) transfers."
"The opportunity for mobile P2P is growing faster than we expected" said James Van Dyke, President and Founder at Javelin Strategy & Research. "There's a higher interest among tech-savvy consumers to engage in mobile P2P, and domestic transfers and international remittances have emerged as the two primary reasons. Banks are weary of deploying more technology in a tough economy, yet we could soon see a battlefield for mobile money that pits telco carriers against financial institutions."
The Javelin report also reveals that the number of consumers likely to use mobile P2P payments and transfers has increased sharply to 26 million, with an additional 6 million people expressing interest since 2008. Mobile P2P may finally be ready for prime time and major banks should not risk losing out to telcos and their many smartphone-equipped customers. Mobile P2P payments and transfers offer an initial income-generating step for financial institutions on the pathway from mobile banking to eventual mobile payments for everyday purchases in physical-world stores.
Within the report, Javelin analyzed 13 vendors: Affinity Global Services, CashEdge, Fundamo, M-Via, MasterCard Mobile Money Send, mCheck, M-Com, Monitise, MPayy, Obopay, PayPal, ZoomPass, and Western Union. Javelin categorized the vendors within five classifications: Ecosystem Developers, Partnership Opportunities, Stand Alone Solutions, Bank-Oriented Solutions, and Carrier-Oriented Solutions.
Key Findings of Mobile Person-to-Person Payments Report
- Smartphone adoption has almost doubled in the past year.
- Nearly one in three online consumers with mobile phones and one in four online consumers have an interest in using mobile P2P payments.
- Sending and receiving money quickly are cited as the primary motivation by consumers to engage in mobile P2P.
- Bank-oriented products from vendors such as CashEdge and M-Com are currently best positioned to emerge as the dominant solutions for mobile P2P.
- The future success of ZoomPass in Canada could drive further activity on the carrier side and provide a wake-up call to financial institutions.
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