Mobile Payments and Security

insidesecureINSIDE Secure has a new infographic showing that 17% more consumers will start using mobile payments over the holiday season. Nevertheless, security is still a big concern…


This correlates with previous research by Accenture where I commented that users need more motivation to pay by mobile to help overcome the security concerns.

Making Mobile Payments More Popular

accentureAccenture has a interesting new 2015 North America Consumer Digital Payments Survey (pdf) of 4,000 consumers tracking trends in consumer attitudes toward making payments today and in the future. While the report pertains to North America, the conclusions and mobile-specific implications are probably just as applicable to the rest of the World.

A relatively low 18% of consumers make mobile payments regularly. Those who do, tend to be high-income (38%) or millennials (23%). People are using cash, debit cards and cheques at about the same level as last year and, despite Apple and Google mobile payment initiatives, there hasn’t been any significant upswing in usage of digital payments. The few people using digitial payments tend to be using Paypal (16%) or paying via retail mobile payment apps (14%).


I believe the main problem is that people are continuing to use the payment methods they habitually use and more importantly trust. What does this mean for mobile developers incorporating newer payment methods into apps?

It’s all about trust and motivation. As the report mentions, we should be providing assurances that fraud will be covered and keep the buyer informed about account activity, payment and order execution. We should also be considering discount pricing, coupons and rewards points to provide incentives for buyers to switch from their tried and trusted payment methods.

In-App Purchase Characteristics of Top Apps

amazonAmazon has a new informative slideshare presentation ‘What the Top 50 Apps Do with IAP that the Rest of Us Don’t’ with insights into in-app purchasing. While the insights have been obtained from the Amazon app store, they are just as applicable to all stores and all OS platforms.
amazoniapHere are some of the learnings and consequent recommendations…

  • Start cheaper and increase price(s) over time to about 60% of the original price.
  • 48% of purchases happen within 1hr of previous purchase. Hence, make sure you offer an IAP within this time.
  • 37% of users who will purchase, purchase on the first day. Again, engage the customer early.
  • Offer between 1-5 price points for the best conversion. More prices points can confuse the user.
  • Apps with tutorials have a 2.5X higher conversion rate,
  • 1.14% of paying customers generate 30% of the sales. Cater for your best and longest customers by differenting your IAP offering.
  • As with non-IAP apps, retention is the only important metric. Give them a reason to come back, for example use social, leaderboards and achievements.

Mobile Payments and Banking Market Map

firstpartnerFirstPartner have a new 2015 version of their free Mobile Payments & Banking Market Map. It shows consumer segments, mobile financial services, types of payment, the payment value chain, payment processors and providers, technology and system vendors, regulators, industry association and standards bodies. There are also some useful statistics, for example, there are forecast to be 195 billion mobile and tablet transactions per year by 2019, a factor of three more than there were for 2014.


Mobile Payments Whitepaper

The Application Developers Alliance have a free whitepaper on Mobile Payments (pdf) with an emphasis on the issues affecting merchants.


It offers a simple overview on the payments ecosystem and covers beacons, digital currencies, omnichannel, NFC and mobile wallets. It mentions issues such as security, fraud and market fragmentation.

GSMA Mobile Economy Report 2015

GSMAThe GSMA has a recent free report (PDF) into The Mobile Economy 2015. The 78 pages are a mine of information for any startup needing a global view of mobile. Here are a few insights I found interesting.

There’s often talk of how much (or little) money there is in devices or apps. However, how do these actually compare to each other and how do they compare to the money made by network operators? The following chart shows the World GDP split by mobile area. It shows the majority of the commerce is actually in network operators…



Another is interesting chart is the one showing commercial NFC-based payment launches over time…


I didn’t realise there were so many launches outside of Apple Pay.

Mobile Commerce Transactions, NFC and mTicketing

juniper.gifJuniper has new research that says that Mobile Commerce Transactions will Approach 200bn By 2019. If you want to be part of this, Juniper say that NFC and mTicketing are likely to be the top growth areas.

However, if you get involved with NFC and ticketing then make sure it’s secure. As Trend Micro recently demonstrated, poorly designed/implemented systems can easily be hacked. There’s probably a great business waiting to happen (or already happened) for the right company that can white-label secure NFC/mTicketing solutions.

Apple Pay Limitations

apple.gifThere’s an interesting article on USA Today Money quoting a UBS report explaining problems with Apple Pay that will limit its dominance…
  • Onerous fees charged by Apple
  • Inferior technology
  • Little incentive for merchants to adopt Apple Pay-compatible devices

More reasons then, why Apple should open up NFC before interested parties develop alternative solutions.

Looking wider, this provides learnings for any new venture. Are the fees you expect to charge reasonable in the current (and future market), can people easily circumvent your solution using other technologies and are you expecting too much of third parties to change/update their systems in order to be part of your solution? I suppose it’s really about having an old fashioned business model which is one of the stages of my primer.