If the old newsroom rule of thumb about three examples making a trend is true, then the new trend in mobile and digital payments is increasingly robust forecasts about future growth.
First up, mobile payments and US retail. According to the research arm of the Business Insider portal, in-store mobile payments in the United States will reach $189 billion by 2018. This would represent a compound annual growth of just over 150% starting with a baseline of $1.8 billion in 2013. The analysts say that while such payments are currently growing at a fair clip, useage will only explode in 2016, when the network effect of a larger universe of consumers and merchants kicks in.
Of course, proximity payments in a single national market only represents one segment of the mobile payments industry, which in turn is but one chapter in the larger story of digital payments. And according to a report released by Jupiter Research this week, the annual global market for digital payments will reach $4.7 trillion by 2019, almost double the $2.5 trillion expected for this year.
Juniper’s report highlights the growing importance of emerging markets such as China, pointing out that Chinese e-tailer Alibaba accounted for upwards of 20% of global digital spend. (This focus on emerging markets is shared by Cellum, which enjoys partnerships throughout emerging Europe, Asia and beyond.)
The report also revealed that, for the first time, this year the combined volume of digital transactions on mobile handsets and tablets would eclipse that of desktops and laptops. Meanwhile, in the area of mobile payments, Juniper said that the growth in transactions would be pushed along by the adoption of host card emulation-based NFC solutions.
Finally, returning to US domestic retail, a report put out a few weeks ago by Javelin Research underscores the growth in mobile and digital payments with a single remarkable statistic: According to its forecast, American retailers will see a 10% drop in the use of cash in 2014 alone. Just wait until 2018-2019!