Mobile payment use is growing slower than initially projected, particularly in the emerging markets, said Gartner.
Gartner research director Sandy Shen said mobile payments growth in emerging markets had not been as robust as anticipated despite favorable conditions as service providers had not adapted their strategies to suit local requirements. Shen added models from successful markets such as Kenya and the Philippines were unlikely to be translated to other markets.
SMS and USSD services are expected to remain the dominant access technologies in emerging markets due to the rampant use of entry-level mobile phones.
According to Gartner, money transfers and prepaid top-ups will drive transaction volumes in the emerging markets, particularly in Eastern Europe, the Middle East and Africa, accounting for 54% and 32% of all transactions by year-end.
NFC use has meanwhile been promoted in mature markets with scant regard for the technology’s complexity, said Shen.
According to Shen, NFC’s biggest barrier lay with consumer behavior, which has yet to be sufficiently altered from the payment norms of cash and credit cards to that of the mobile phone. Gartner estimates put mass market NFC adoption at four years away.
WAP is meanwhile expected to remain the preferred mobile access technology in the developed world, accounting for close to 90% of mobile transactions in North America and 70% in Western Europe by year-end.
Merchandise purchase is expected to form the bulk of transactions in North America and Western Europe (90% and 77% respectively) due to the success of mobile application stores and mobile payment promotion efforts from major retailers.
Gartner expects worldwide mobile payment volume to total $86.1 billion by year end, up 75.9% from last year. Mobile payment users worldwide are expected to surpass the 141.1 million mark by year end, a 38.2% increase from 2010.