Fintech North America Paytech

How Mobile Payments are Shaping the Future

How are you reading this article? Chances are, you’re reading this on mobile. Even if not, there’s likely to be a mobile phone within the vicinity.

Mobile phones are such a huge part of our lives that it’s easier to forget our wallets than our phones. Payment providers have been quick to capitalise on this. Everybody who is somebody in the mobile industry has their own payment offering: Apple, Samsung, Huawei, etc. It works both ways. Established payment companies are also working on mobile products, such as PayPal Here.


Types of mobile payments that a payment service provider can offer

Mobile payments can be divided into two distinct categories: payments on mobile and payments by mobile.

Payments on mobile take place within the mobile ecosystem. A good example is mobile gaming. Free-to-play games offer premium options. Players can buy in-game currency or add-ons without leaving the app. Mobile shopping is another example.

In fact, not putting the phone down is an integral part of the entire experience. Mobile payments are popular for one simple reason: the easier it is to pay, the easier it is to sell. Any extra steps give people a reason to rethink the need to buy.

Perfect user experience means customers don’t want to leave the app. Payment service providers may provide their clients with a mobile software development kit (mSDK), which is a piece of code prepared in advance to integrate payment options into the client’s app.

This is a type of mobile payment system based on the ubiquity of mobile services, but what about things not available on mobile, such as point-of-sale payments at retail establishments?


Pay with your phone

Payments by mobile take advantage of the fact that you always have your phone with you. Forgot your wallet at home? No problem. If your local retailer offers a mobile payment option, you can still shop.

It’s not a new concept. It actually predates smartphones. Solutions like pay-by-SMS have been around for years. Much like all things mobile in recent years, mobile payments have quickly gained traction.

The key to wider adoption has been simplicity. Mobile card payments allow users to attach their existing cards to their mobile phones.

Another key innovation has been mobile contactless payments. At this point, it’s almost synonymous with NFC payments, although this may change in the future. NFC payments are almost the same as contactless payment cards when it comes to customer experience.

The customer puts their mobile phone near an NFC-enabled POS terminal to make the payment. The rest of the process is identical to any other payment. The acquirer sends a request to the issuer and completes the payment – if it receives confirmation, of course.

An alternative to NFC may be on the horizon. Apple, Samsung, and Huawei are battling for their share of the payment market with Apple Pay, Samsung Pay, and Huawei Pay, respectively. They’re constantly on the lookout for faster, more convenient technologies to simplify the mobile payments process.


What’s a merchant to do?

So, where does that leave you? What do you do if you are a merchant who understands the importance of mobile?

It’s important to remember that mobile is not the future, it’s the present. If your business is in any way digital, you need to provide your customers with a mobile payment method.

You should ask yourself: does my app feature a seamless payment process? Do customers need to open links in their browsers to complete the payment? A good payment service provider will be able to provide mSDK to help you out.

If you’re a brick-and-mortar retailer, all the competing platforms may baffle you. The good news is that it’s not as critical for you as it is for online merchants – yet.

Contactless card terminals can already handle some types of mobile payments. The bad news is that you’re on a deadline. Soon, it will be imperative to the success of your business.

But don’t worry. This is much easier to navigate with an experienced payment service provider by your side.



Paul Marcantonio

Head of UK/Western Europe at ECOMMPAY


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