A KPMG survey of nearly 1,000 executives in the financial services, technology, telecommunications, and retail industries globally has found that 83 percent of the respondents believe that mobile payments will be mainstream within four years, compared to only nine percent who see them as mainstream today. In fact, 46 percent believe mobile payments will be mainstream within two years.
"We believe that exploding smartphone growth and myriad opportunities will grow mobile payments at a much faster rate than our respondents anticipate," said Gary Matuszak, KPMG Global Chair of the Technology, Communication and Entertainment practice. "A wide variety of payments is ready for adoption, as several key players already provide or are rolling out mobile payments, and interest among consumers in utilizing mobile payments is growing, in line with the industry's readiness to deploy them."
Seventy-two percent of the executives said that mobile payments are now or will be reasonably important in the future, with mobile banking and near field communication (NFC) gaining significantly greater traction than today. Fifty-eight percent said they have a mobile payments strategy in place.
"While there is consensus about the significant value of this opportunity among executives across geographies and industries, the type and size of opportunity varies between developed and developing countries depending on depth and reach of the financial infrastructure in place. We believe that those firms willing to engage in cross-industry partnerships and coopetition are more likely to succeed and dominate the market due to the complex set of business relationships required to deliver mobile payments to a mass market," said Matuszak.
Asked about the benefits of a mobile payment strategy, 81 percent believe convenience/accessibility is the highest attribute, followed by simplicity/ease of use, at 73 percent, security, at 57 percent, and low cost, at 43 percent.
At the same time, business leaders, globally and in the U.S., view security as the main challenge to developing mobile payments strategies. Technology and adoption of the technology is a distant second, followed by privacy.
"The business leaders understand that when it comes to consumers choosing a provider based on security, reputation can make the difference, and any damage to a business' brand can prove costly, even to the extent of being a showstopper," said Sanjaya Krishna, KPMG U.S. Digital Services Leader in the TCE practice. "As a result, leading businesses are adopting multiple approaches to alleviate customers' privacy and security concerns."
Bank and credit card companies will have the most important roles in mobile payments, according to the business leaders surveyed. They placed telecommunications companies third, ahead of specialist online payment players (eg. PayPal, Boku, Obopay), online service provider giants (e.g. Google, Facebook, Amazon), retailers and technology companies. Among U.S. respondents, online service provider giants placed third, followed by specialist online payment players and telecommunications companies, which were rated of equal importance, retailers and technology companies.
