Among other technology trends accelerated by the COVID-19 pandemic, the use of contactless mobile payments will flourish in 2020. The outbreak of COVID-19 in the United States gave an unexpected boost to the long-fought goal of companies like Apple, Google and Samsung Electronics — to get more and more customers to use mobile wallets.
According to a recent report by the analytics firm eMarketer, mobile in-store payment usage in the United States increased by 29 percent last year as the pandemic prompted consumers to exchange cash and credit cards at points of sale for potentially more secure mobile payment options.
Last year, 92.3 million US consumers 14 years old or older used a close-in mobile payment at least once in a six-month period in 2020 — a number eMarketer expects to grow to 101.2 million this year. By 2025, more than half of all smartphone users in the U.S. will use contactless mobile payments, according to eMarketer.
The highest adoption rate of contactless mobile payments last year was among younger consumers, including Gen Z and millennials. EMarketer expects the former to account for more than 4 million of the 6.5 million new mobile wallet users added each year from 2021 to 2025. Meanwhile, U.S. millennials will continue to make up about four in 10 mobile wallet users.
Multiple industry reports have noted the impact on the mobile wallet industry in general, with a report from financial and investment firm Finaria earlier this month estimating that the industry will grow 24 percent from last year to reach $2.4 trillion in 2021.
Finaria has said that while Asian markets, especially in China, have been leaders in mobile payment applications, the U.S. has previously struggled over the slow promotion of mobile payment technology by retail stores. But now, the United States has grown to be the second largest market, with $465.1 billion in mobile payments transactions, which will grow to $698 billion by 2023.
The COVID-19 epidemic has pushed lagging retailers to finally jump on the mobile payment bandwagon.
A survey released mid-year by the National Retail Federation and Forrester in 2020 found that 69 per cent of retailers have increased their contactless payments and 67 per cent now accept some form of contactless payment, including mobile payments and contactless cards.
Although e-wallets are beginning to become popular with Americans, many customers and employees don’t know how to use them. For one thing, the number of cash thefts from ATMs in the United States more than tripled last year from the previous year. On the one hand, because the outbreak affected social security and stability, on the other hand, because after the bank closed, there was a lot more cash in the ATMs than usual.
As a result of the changes in the industry, eMarketer reports that not only has mobile wallet usage increased, but the average annual spending per user has also increased. EMarketer predicts that figure will grow 23.6 percent from about $1,73.70 in 2020 to $2,439.68 in 2021, and to more than $3,000 in 2023.
In the United States, Apple Pay remains the No. 1 player in mobile payments, with an estimated 43.9 million users in 2021 and a projected growth of 14.4 million between 2020 and 2025, outpacing its competitors. Starbucks will remain the second largest player with 31.2 million users, followed by Google Payments, which is expected to grow by 10.2 million users during that time frame. At the same time, Samsung Pay’s growth stagnated, with only 2 million expected between 2020 and 2025.
Article source: CNBETA