US Mobile Payments Market Is Full, Says Bullpen Capital
There are plenty of options these days when it comes to mobile payments, even in the United States, where cash is still a pretty big part of everyday life. Yet with so many options afoot, it’s easy to wonder if the mobile payments market might be approaching saturation. For Eric Wiesen, general partner at Bullpen Capital, the answer to that question found in a Bank Innovation discussion is mostly yes.
While Wiesen hedged his prediction a bit—noting that he didn’t know if there was room for another customer-facing mobile payment option, and that it would be “tricky” to bring another one out in the face of serious competition—it boiled down to the suggestion that it may be better to look into other markets with consumer-facing mobile payments apps.
Wiesen even had a skeptical note for Zelle, the recently-launched, bank-backed peer-to-peer (P2P) payments app. Wiesen noted that banks have tried to do something similar in the past—three or four times, in fact—and it had yet to really work out. While Zelle does seem to be doing quite well so far, that may be temporary or otherwise ephemeral.
Wiesen, however, did have good things to say about India, pointing to the “crazy growth” the country was seeing in mobile that posed a great opportunity to “get payments right” in the country. He’s not alone on suggesting India as a development target; several others have likewise pointed that out and several more efforts have been made to bring payments to the region.
I admit, I was at least tangentially agreeing with Wiesen for some time; seeing all the new apps emerge made me wonder where that saturation point was. After all, the typical user only keeps so many apps front and center on a smartphone display, and once you get past that first or second swipe to the next page, the chances of interaction drop through the floor. There had to come a point where all these vaguely similar apps just weren’t worth using and some competitors departed the market.
Yet there’s still new development coming, and not just in India. What’s clear, however, is that those who bring new apps out are going to have to work hard at differentiation and innovation to prove they’re worth a slice of this market.