Digital Mobile Payments by E-mail may be a new norm in Digital Payments
It started with Google Wallet letting you send money via Gmail. Here is how it worked:
As the video above explains
- There will be a dollar-sign icon for Gmail attachments. Click it and you can transfer cash via Google Wallet.
- The recipient doesn’t have to have a Gmail address and you can receive money as well.
- You can also pay using your credit and debit cards for a fee of 2.9% per transaction (minimum $0.30.)
- Google claims the transactions are encrypted and stored on secure servers. Transactions are also monitored to preempt fraudulent activity. Google Wallet Purchase Protection also covers 100% of “eligible unauthorized transactions.”
A few days after Google announced the ability to send money via email, mobile payments purveyor Square has done the same. Square Cash lets consumers send money to friends by cc-ing “pay@square.com” and including the dollar amount in the email’s subject line. Square takes a $0.50 cut of each transaction.
[Earlier in June 2012]
Some Latest Digital Payment Platforms you should know about
- Square: The Square app is excellent at helping you to get paid, and get paid on time. It has paved the way for simple online credit processing and offers a sleek UI. Plus, it helps that it’s easy to use on a mobile device and offers features like the ability to hold particularly large payments for thirty days.
- Chargify: Chargify’s user interface is relatively easy, their API makes their service even more flexible, and the integration that it offers is unparalleled. Chargify takes literally five minutes to set up
- Braintree: Braintree is easy to integrate with any back-end system. The company also handles all charges, and will vet the customers for you to weed out suspicious transactions. You can even run a subscription program through them. Also, when you’re on the road, it’s an incredibly easy system to access and manually charge customer orders.
- Dwolla: Dwolla can save dollars in PayPal fees. Instead of paying 3% on every transaction — which adds up fast — pay .25 cents, no matter how much money is involved. And any charge that’s less than $10 is free. Dwolla is strictly cash-based, so you can’t accept credit card payments through it, which can be a drawback. However, as adoption spreads, they are going to be a legitimate competitor to PayPal.
Digital Mobile Payments: Latest trends & Statistics
According to a research released by Gartner
- 2012 will see more than $171.5 billion in mobile payment transactions — a rise of over 60 percent on 2011′s $105.9 billion
- 212.2 million people (up 32 percent from 160.5m in 2011) will be using some form of mobile payment service.
- Despite the rise of smartphones, it’s legacy-based services like SMS and web-based transactions fueling this growth
- Transactions will reach a volume of $617 billion by 2016 — with average growth slightly slowing down to around 42 percent — with 448 million users using such services.
- SMS remains the “dominant” access technology for making payments in developing markets, while in more mature markets, the vast majority of transactions are made via mobile internet portals.
- In North America in 2012, 80 percent of all mobile payment transactions will happen via Web/WAP routes. The figure in Western Europe is an even higher 88 percent.
Some emerging trends pointed by Gartner
- Fragmentation in M-commerce / Mobile Payments
There are posibly 2 types of fragmentation in mobile payments space: 1) in terms of service providers 2) in terms of technologies (NFC, SMS, dongles from Square, Paypal etc.). Downside of fragmentation: Keeping any one solution or group of providers from properly scaling up as the de facto standards for mobile payments. That has a knock-on effect for merchants and consumers, of course, who trust such solutions less. These kinds of fragmentation issues are likely to continue for the next two years. The upside of Fragmentation: As mobile payments continue to mature, providers will need to tailor offerings to local markets, or local demand patterns to customize their offerings. That goes not just for regulation and getting approval to offer services in specific markets, but also different retail business models, existing embedded technology, and local preference. For example, while U.S. customers may love Square, the jury is still out whether Jack Dorsey and Co. will be able to take that solution further afield with such success.
- Role of Local Players
There will be a few global players that have the scale and resources to serve large customers and the mass market whose requirements can be readily satisfied by standard solutions. There will always be segments that cannot be sufficiently served by the global players. The demand of these segments can only be satisfied by specialized or local players who can better understand the segment and have specific solutions to meet the unique challenges.
- Drivers of the Mobile Payments Business:
In North America and Western Europe, it will be merchants who will be seeing mobile payment transactions both in physical stores as well as in online payments. Online it will be led by companies like eBay and Amazon, who are already going at a fast clip in mobile payments. Offline, the Starbucks model of using an app to work as a payment method/loyalty card will be the route that others will also take. In developing markets it won’t be merchants as such setting the pace for and using mobile payments. Rather m-payments will be used mainly for other kinds of services like money transfer and top-ups of mobile calling and text minutes. Apparently mobile payments are used to improve the efficiency of buying tickets for public transportation in markets like Africa and South Asia.
- Regional breakdown
North America may make the most noise, but by 2016 it will only be the third-largest market for mobile payments. Asia Pacific will be the biggest region, with Africa at number-two, with the pair accounting for more than 60 percent of all mobile payments in four years. The full table below
What happens to the NFC mobile payments technology?
NFC or near-field communications is the technology that will let people wave their phones in front of a payment terminal to pay for goods and services. NFC will remain “relatively low” through 2015. NFC payment involves a change in user behavior and requires collaboration among stakeholders that includes banks, mobile carriers, card networks and merchants. NFC will be used but not for payments.Ticketing, rather than retail payment, will drive NFC transactions
