UN: Mobile Payments Beat Credit Cards Within Two Years
If you don’t already have a mobile payments system of choice, chances are you will in the next two years. A report from the United Nations Conference on Trade and Development (UNCTAD) suggests that no matter where you live, mobile payments will be big. In fact, mobile payments will actually be used more frequently than credit cards by 2019, if the report holds true.
Back in just 2014, the report notes, a slim 51 percent majority of payments in developed countries were made with credit cards. Just five years later, in 2019, that number is set to drop to 46 percent thanks to improving technology and growing ease-of-use. That’s just for developed nations, however, as cash is expected to remain the payment medium of choice in developing nations.
This is despite reports that mobile payments are gaining ground in developing nations as well. The UNCTAD report found that even in places like Kenya, where mobile payments are indeed gaining, most users still default to cash in direct settings. Even in Egypt, a lot of e-commerce is conducted on a cash on delivery basis.
There’s a lot of room for mobile payments to develop—it’s easy to forget that this is a technology old enough that, if it were a human being, we’d be amazed to see it speak coherent sentences and use the toilet by itself—and we’ll likely see plenty more development to come. Many are looking to the blockchain to provide development here, particularly in cross-border operations.
That’s not necessarily good news; cross-border operations are usually good for some extra fees to banks, and losing that revenue will be a sock in the bottom line. However, given that blockchain operations will likely be smoother and inherently more secure, chances are pretty good that the costs associated with such transactions will likewise fall, and improve the bottom line by reducing costs.
Regardless of the profit and loss picture here, the UN report makes it clear: mobile payments are here to stay, and will be part of the action for some time to come. That’s going to prompt a lot of change on several different fronts, from retail to banking to security to development and beyond, so being ready for these changes will be the key to getting ahead.