Slow Adoption of mobile payment: Recently, mobile devices has increase in the number of devices in the market and this has brought a lot of attention to mobile payments industry, in despite of this attention, mobile payments has not yet been adopted fully in the United States. While many think mobile payment will take off soon, there are barriers to overcome before the market makes the transition to mobile payments. First, the supply side needs to be examined, one of the actual problems is that there is not technological standards, different technologies exist when using mobile payments, including NFC, RFID, 2D barcodes, and WAP. Another barrier is the need of compelling business models, which means get all the …show more content…
Understanding both sides, supply and demand , will give providers the power to decide which technology standards to adopt, what fees to charge and what mobile applications they can use to replace traditional payments methods. Fragmented Market: In order to replace cash or plastic credit cards, consumers need to feel confident they can leave their physical wallet at home. The mobile payment market in the United States is so fragmented that there are no clear standards and the idea of having consolidation and partnership within the big players of the industry is far from being possible. The mobile payment has become a prize that everyone wants to win but no nobody is willing to give up on the race. Far from winning, consumers are the ones who suffer the consequences, they are sitting and waiting until the big players agree to standardize the process. This year (2014) Apple tried to standardize the industry by introducing Apple pay instead they “ highlighted the squabbles between retailers and the banking and payments industry.”10 Since its debut, a coalition of merchants led by Wal-Mart, Target and Sears called MCX have said they would not use Apple pay and instead they are promoting its own system called CurrentC. The main reason why retailers are not using Apple pay is “ to avoid what they believe are excessive swipe fees and the cost of upgrading hardware and software to accept
Businesses that offer multiple payment options reap the rewards of increased sales and larger profit margins1. Williams Arena, the home of University of Minnesota Gopher Basketball, currently accepts only cash at their concession stands during events. This proposal aims to encourage you to introduce credit card payment options at Williams Arena for the upcoming seasons. Doing this would benefit both the Gopher Athletics’ sales department and the patrons of the arena. After the problem is described in detail, a step-by-step plan will outline the process required to update the technology to include credit card readers. Finally, the benefits of this plan are discussed along with the potential costs involved.
This variability can apply to both sides in the Demand and Supply equation – the customer and the provider, hence the necessity sometimes for the introduction of regulations within the market to impose rules of rationality and reasonableness upon the parties and achieve market equilibrium (Mankiw & Taylor; 2006).
There are also challenges that this industry is facing such as restrictions on online payment services by the government and agencies, security of information and data, and adaptation is also a problem. There is a race to control online payments and data processing that includes large known corporations such as Google, Apple, Samsung, Visa, PayPal, Square, Intuit and others more. And these corporations are very far ahead in the industry in terms of technology and consumer market. Apple last year had introduced the app called ApplePay, which enables you to store credit card and debit cards information and even gift cards and pay directly from your phone by
As technology advances over the years, we have experienced and noticed that the trend in how payment are received have shift tremendously. Twenty years ago, check was the preferred way of payment. In today’s world, more and more payments are done by credit cards. Credit card transactions are instance that provides a faster payment method.
Although major retailers have had credit card breaches, which devastated consumer trust in credit, Mobile payment systems stay efficient, but risk personal and financial data fraud similar to plastic credit card usage theft. Patrons fear merchants can track your shopping habits, location and financial records using a mobile GPS signal. Nevertheless, worries that someone can steal their information when sent wirelessly therefore consumer confidence remains low. Thorough safety measures will help give customers composure and regain assurance. (Busby, 2014) (Sapienza, 2013)
Payment processing has become more universal. Each transaction, whether it's in-store, eCommerce or mobile, needs to deliver a seamless integrated buying experience at any time of the day and on any device being used.
According to the most recent Federal Reserve study; most of us haven’t set foot in a banking hall in ages. It is a lost battle to banks that opt to use traditional methods to conduct their banking transactions (Gup 2003). By December of last year, close to half of all smartphone users in the United States had transacted some or all of their banking on their phones and iPhones. In the United Kingdom alone, rates of mobile banking transactions doubled over the course of a single year (Scn Education 2001). A banking business that invests in this type of technology gets assured of increasing their customer base.
In 2016, e-Marketer estimates that 37.5 million people in the U.S. (19% are smartphone users) will transact using their phones, by the end of 2016, mobile payments are expected to exceed $27 billion. Predictions are that by 2017, U.S. mobile commerce will have increased so much in popularity that it will account for 50% of U.S. total digital commerce revenue (Mobile ecommerce, 2016).
. Mobile payment users >190 MM in2012, which is over3 % of total mobile users worldwide a level considered as "mainstream”
In today’s economy, cash or a credit card is needed to meet the basic human needs. It is an apparent fact that we need cash or credit cards to purchase items such as food, clothing, and to buy gas. Also, when you are out shopping and discover that you have used all the cash in your possession, it is then that you realize that the advantage of having a credit card. Furthermore, with cash, you are restricted to the amount in your wallet or purse; however, a credit card allows you to pay for your purchase at a later date. Both cash and credit cards can be useful when you manage them wisely. While cash and credit cards are similar in that they both are readily accessible, used for goods and services at the time of purchase, they are dissimilar because of theft, high- interest rates, identity theft.
The Harvard Business School case study Mobile Banking for the Unbanked explores two very different examples of mobile financial service models:
The online payment marketplace is experiencing an explosion of innovative ideas, plans, and announcements, which one commentator has likened to a “goat rodeo”, a chaotic situation in which powerful players with different agendas compete with one another for public acceptance, and above all, huge potential revenues. Others liken the payment marketplace to a battle among the four platform titans Apple, Google, Facebook, and Amazon. Each of these titans have their own versions of a future payment system that challenges the other players. And let’s not forget PayPal, the reigning power in alternative online payment, or the credit card companies who process over 70% of online payments, or the
Almost everyone has a smartphone, so engineers invented a way to let merchant charge customers through a device that can be attached to any mobile phone. This device, or credit card terminal, is the future of credit card terminal technology, where merchants can charge customers anywhere and anytime [3]. This report will present the market analysis, theory of operation, and the device performance of Square.INC credit card reader [3].
The last decade has witnessed a lot of growth of mobile communication devices and wireless technologies across the globe. This has led to a change in the way many activities are conducted and opened the way for m-commerce, which is e-commerce's next evolutionary stage. The significant power of m-commerce is primarily as a result of the ability to connect wireless devices anytime, anywhere (The Future of Mobile Payment Systems : Rise of the Mobile Wallet 2012-2017 [Electronic version], 2011).
Mobile banking is well utilized in countries of Europe and even Japan, yet it is slow to catch up in America. A study by Forrester Research found that only 10% of Americans like the idea of m banking while 35% already bank online