Nearly 2.1 billion consumers worldwide will use a mobile wallet to make a payment or send money in 2019, up nearly 30 percent from 1.6 billion recorded at the end of 2017, according to a new study by Juniper Research.
The study reported that while contactless card payments were far more prevalent than NFC mobile payments in many markets, leading wallets were seeking to adjust the balance by enabling both online and offline options.
Meanwhile, a number of wallets, including Orange in France, have augmented payments offerings with banking services in a bid to deliver a holistic financial portfolio for consumers, according to a press release.
The report, Mobile Wallets: Service Provider Analysis, Market Opportunities & Forecasts 2018–2022, assesses the capabilities and prospects of nearly 20 leading mobile wallets, and concludes that PayPal, which now offers in-store contactless payments in the U.S., has the greatest opportunity to develop a converged wallet on a worldwide basis, closely followed by China’s Alipay.
The report also argues that while QR code-based in-store payments have seen significant levels of adoption in China, successful use cases in Europe and North America are likely to be limited to ‘closed-loop’ wallets such as those deployed by Starbucks and Walmart.
According to the research, greater security offered by NFC-based wallets, which use tokenized credentials and, increasingly, biometric authentication, make them more attractive to both consumers and merchants.
“QR code-based payments are likely to have significant growth in markets such as India and sub-Saharan Africa, due to negligible implementation costs,” report author Dr. Windsor Holden said in the release. “However, their greater susceptibility to alteration to include viruses and phishing scams is likely to act as a major deterrent elsewhere.”