If you were wondering what the state of the mobile payments market is looking like these days, the answer is, put simply, “really good.” At least, that’s the general idea behind a new report from Allied Market Research, who noted that the overall market was set to hit $3.388 trillion by 2022.
That represents, the report noted, a compound annual growth rate (CAGR) of 33.4 percent in the time between 2016 and 2022. Several factors are poised to drive this spiraling growth rate, including an overall increase in smartphone use, new opportunities coming into view in the mobile commerce industry, a rising change in lifestyle, and a need for fast, easy, and secure transactions to power that lifestyle and take advantage of those opportunities.
A litany of accomplishments in the field have followed, including Glance Technologies’ recent success—the company saw its strongest-ever quarter for both launches and new merchant partnerships—and Square, which brought out its Square for Restaurants service geared toward breaking into that market.
NTT DATA’s Peter Olynick noted “Anytime you can remove the friction of the payment we are seeing those companies are getting a nice uplift. If you walk into a retailer and pick up one or two things and there is a line at checkout, you put it down and walk out because don’t have the 15 minutes it will take for that queue to open up. When we can get to the point where the payment itself is frictionless, we will get those sales that have been lost….”
There’s little doubt that mobile payments are making headway. All anyone has to do is look at the news out of Starbucks in the last two years and it should be clear how mobile payments not only worked well for the company, but worked too well in some points. Throw in the growing number of restaurants using mobile payments, mobile order-ahead, or even a combination therein and you’ll see the value of this technology for just the restaurant market. Stretch it out beyond that and a multi-trillion market isn’t that outlandish.
Cash may be king, but there’s no doubt mobile payments are an up-and-coming product line. It may not reach quite the levels the report projects, but big gains are likely afoot.