Global Mobile Payments to Reach $620 Billion

By Douglas A. McIntyre Updated Jan 13, 1:51PM EST · Published Feb 1, 6:55AM EST

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Global Mobile Payments to Reach $620 Billion — © Thinkstock

Mobile payment systems, essential to the fate of many retailers and electronics firms, including Apple Inc. (NASDAQ: AAPL), should take off in 2016. That conclusion from research firm TrendForce should hearten companies gambling that consumers won’t stay tied to credit cards and cash.

TrendForce researchers report:

With major smartphone brands Apple and Samsung making a big entrance into the mobile payment business, the total revenue of the worldwide mobile payment market in 2015 reached US$450 billion, according to the global market research firm TrendForce. By the end of 2016, the total revenue is estimated to arrive at US$620 billion, representing a massive growth of 37.8% year on year.

The growth rate drops to 25.8% in 2017, 19.2% in 2018 and 16.1% in 2019, which takes the total to $10.8 billion for the final year.
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Apple management repeats over and over that the iPhone’s fate depends on China. The mobile payment business seems the same:

Apple Pay and Samsung Pay especially have been scrambling to China, which makes up a huge slice of the mobile payment market. The rival service providers both struck a deal with the government-run Chinese bank-card payment processor China UnionPay earlier this year. Hence, Chinese iPhone and Samsung phone users will be able to make mobile payments this year, provided that their models are of the latest generation with upgraded software.

The iPhone 6 and iPhone 7 “latest generation” sales might jump as consumers move to mobile payments. With flattening iPhone sales, Apple should hope so.

Apple and Samsung may be hampered by institutions that do not want to see part of their business stolen:

Besides financial institutions, retailers are also looking into developing their own mobile payment services. Leading U.S. retail chain Walmart, for example, launched Walmart Pay last year with the hope of building its payment business on its customer base of 22 million. Walmart Pay is expected to be available in all of Walmart’s U.S. stores this year. Target, the second largest discount retailer in the U.S., will soon launch its mobile wallet solution as well to assert control over its mobile transactions.

As the mobile payment industry grows, so does the competition.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.