The global market for mobile wallets is highly consolidated in nature and led by a few key players, states a research report by Transparency Market Research. In 2012, the leading players, including Paypal, Google Wallet, and ISIS (Softcard) collectively represented a share of 70% in the global mobile wallet market. Being a price-sensitive market, interoperability is considered to be the key factor fuelling the growth of the market. Additionally, frequent partnerships between competitors for standardization are expected to supplement the growth of the market in the coming years.
According to the research study, the global mobile wallet market is expected to reach a value of US$1,602.4 bn in 2018, rising from US$675.0 bn in 2015. From the geographical perspective, the Europe, the Middle East, and Africa segment is expected to lead the global mobile wallet market and account for a 39.5% share by the end of 2018. The growing population in Africa and consumer preference for mobile payments, owing to low penetration of banks, is expected to bolster the mobile wallet market in EMEA.
Increasing Number of Retail Outlets to Benefit Global Mobile Wallet Market
Among the key application segments, the retail segment is estimated to lead the global market and account for a 46.4% share by the end of 2018, followed by the segment of vending machines. The retail segment is projected to witness immense growth thanks to the rising global demand and the willingness of consumers to make use of mobile wallets for frequent and small purchases. “The rising number of retail stores worldwide and the convenience of payment using mobile wallets are the primary factors augmenting the growth of the retail segment of the global market,” states a TMR analyst.
By consumer type, the card users segment is projected to lead the global mobile wallet market and reach a value of US$793.2 bn by the end of 2018. The rising number of card users and the increasing added benefits of cards are expected to drive the market in the next few years.
Government Initiatives for Online Payment Activities to Propel Mobile Wallet Market
The rising penetration of smartphones and the growing use of mobile data are the primary factors propelling the global mobile wallet market. Merchants and retailers who are a fundamental part of this process also offer diverse benefits to users that can be availed with an active mobile data connection. Additionally, mobile wallets offer convenience to users as they provide a platform for complete management of a user’s finances in one device. The convenience of paperless transactions and easy access to cashless payment portals through smartphones are expected to boost the demand in the coming years, says a TMR analyst.
As numerous developing countries do not have proper access to mainstream financial services, several financial institutes, governments, and telecom companies are coming together to bridge this gap. Government initiatives to encourage online payments are expected to drive the global mobile wallet market in the coming years.
Security Concerns to Dampen Growth of Global Mobile Wallet Market
The risk of financial credentials being stolen and the possible loss of a mobile-wallet-equipped device are the primary factors restraining the growth of the global mobile wallet market. Nonetheless, the untapped opportunities in developing economies are expected to encourage the growth of the market in the coming years.
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