Mobile Payment Magazine

Utility, Healthcare and Insurance Industies Plan Increased Mobile Billing Options for 2011, Says Survey

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Only about 20% of Utility, Healthcare and Insurance industry companies currently offer customers the option of mobile text bill presentment, and 60% of those polled indicated they have plans to offer such services in 2011, according to a recent poll by BillingTree.

BillingTree, Inc, one of the nation’s leading on-demand payment processors, today announced results from a poll taken during a recent webinar, which looked at the benefits of using mobile payment solutions to collect from customers, particularly in the Utility, Healthcare and Insurance industries. Of those attendees polled, only 20 percent currently offer customers the option of text bill presentment and authorization, but 60 percent of those polled plan to in 2011.

These findings support recent NACHA statistics for utility companies, which predict a 35% year-on-year growth rate in e-billing, with 100% planning to offer mobile alerts within the next 12 months. Additional webinar survey findings include:

  • Only one third currently offer pre-paid accounts with mobile funding for their services.
  • 85% believe offering new mobile prepaid and text solutions will increase customer adoption of paperless billing.

Mobile payment options offer much greater convenience for customers on the go, and provide a tool for organizations to communicate directly with their customers about possible service outages etc., as well as any outstanding bills.

“The results from the webinar show that the rapid mainstream adoption of text messaging is driving many organizations to think more seriously about integrating mobile payments solutions,” said Scott McCollum, BillingTree’s President. “Our Mobile Solutions Suite delivers on this increase in customer adoption, and will help organizations to collect from customers more effectively and in a way that better suits their needs.”

BillingTree supplies fully integrated, multi-channel electronic payment platform to a growing list of Industries, including Insurance, Utilities (such as energy, cable, municipal, and phone), as well as Healthcare and Subscription-billed services. Benefits of electronic payment solutions include an accelerated availability of consumer funds, reduced costs associated with manual-payment processing, improved cash management, and integrated processing by managing all payments, returns, and corrections through a single portal.

Source: PRNewswire

Integrated Channel Strategy Necessary for Marketing Financial Services to Youth, Says Report

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Banks risk jeopardizing future customer acquisition and retention by failing to recognize the continued importance of factors such as traditional branch networks and parental influence, according to a recent survey. The survey was commissioned to understand youth attitudes and behaviors relating to personal finances, payments and banking of 1400 16-18 year olds from the UK, China and Brazil.

While contemporary banking channels such as mobile are gaining traction among the youth segment, the research, conducted by Survey Shack on behalf of Temenos, a Swiss banking software company, found that traditional banking channels and influences are key drivers among this segment when looking at establishing a new banking relationship.

Respondents from the UK and Brazil cited parental influence as the single biggest driver behind decisions to open a bank account.  37% of Brazilian and 33% of UK respondents stated that they would choose a bank because their parents banked there. All three countries rated branch location as the second biggest driver, with 28% of respondents citing this as the most significant consideration. 90% of respondents globally believe that the branch will serve a purpose for them in the future.

The study also suggests an increasing trend emerging in mobile banking among the next generation, notably in m-commerce. This is particularly evident in China, where 17% of respondents already use their mobile for purchases. This evidences an underlying acceptance for performing sometimes complex transactions using this channel, 40% of respondents globally regularly use their mobile handset for accessing social media, the UK being the highest user at 60%.

“With so much market emphasis being placed on digital and mobile channels, which play a very important part in the future of financial services, banks mustn’t lose sight of the continued importance of traditional channels. This research illustrates that banks need to be responsive to these trends and should consider a balanced attitude to channels, using mobile and other modern channels where appropriate but not underestimating the value of traditional bricks and mortar, even when attracting the younger generation.”, commented Mark Gunning, Global Director, Banking Services, Temenos.

Source: Temenos

The Mobile Internet Market in China: Outlook for 2011

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CCID Consulting has released highlights from its new research report summarizing China’s mobile internet market in 2010, and outlook for 2011, where the  company predicts strong growth in the development in the platform businesses along with intensifying competition for users in 2011:

It has been ten years since the start of the mobile internet as a WAP application in 2000. With the extensive construction of 3G networks, the gradual spread of 3G applications and the advancement of Internet Web2.0 in China last year, the mobile internet has began to reveal its huge potential.

2010: Rapid growth in the number of users & an emerging industry landscape.

Mobile internet saw rapid growth in 2010, with the number of users and revenue increasing constantly. According to the 26th Statistical Report on the State of China’s Internet released by CNNIC, as of June 2010, the number of users using cell phone for internet access amounted to 277 million, or about 40% of all cell phone users; among them 43.34 million were newly added in 2010, representing a growth of 18.6% from the end of 2009. The mobile internet revenue continued its fast growth on the basis of RMB 11.2 billion in 2009, and CCID Consulting expects the revenue of 2010 will exceed RMB 15 billion.

As for the terminals and platforms as carriers for mobile internet, hardware terminals led by cell phones also maintained their growth momentum, with annual shipment of mobile phones exceeding 700 million units in 2010, accounting for 60% of the global production. Smart phones and functional mobile phones also gained traction; smart phones saw an increase in its market share, while functional phones were still popular thanks to their low prices and ease of use. Currently, the mainstream mobile platforms include MTK-based Java, Symbian, Windows Mobile, Linux, Android, OMS, IOS and Brew, with the Java platform grabbing the largest share due to the huge number of functional phones, followed by Symbian, thanks to Nokia’s market share and Brew due to its monopoly of Qualcomm in the CDMA market.

The huge number of users helped accelerate the market maturation and business growth, characterized by an increased level of commercialization, continued advantages in entertainment features, and growing value as a tool of communication and information.

Mobile e-commerce represented by mobile payment saw a significant growth in 2010:

  • China UnionPay, in alliance with eighteen commercial banks, as well as China Unicom, China Telecom and mobile phone manufacturers, established the Mobile Payment Industry Union;
  • YeePay, a domestic third-party payment giant, acquired WestPay in Chengdu, ushering in the age of industry reshuffling;
  • Mobile entertainment represented by music, e-reading and games also continued its fast growth. In 2010, China Mobile’s music base in Sichuan contributed revenue of over RMB 10 billion;
  • following Hanwang, SDO leveraged its advantages in online literature to launch its own e.p.book.

Communications and information tools such as instant messaging (IM), mobile community and location services are gaining traction, with the number of active mobile IM users reaching 162 million and the number of mobile browser users exceeding 100 million.

Meanwhile, the business model of application stores is gaining popularity. MM (Mobile Market) launched by China Mobile last year now boasts 80,000 registered developers and 11 million registered users. It has sold a total of approximately 30,000 applications and has seen over 40 million downloads. Platform and mobile phone vendors such as SIKAI and Nokia have set up their own application stores. Diversity of businesses and services content has become a major feature of mobile internet development.

Despite the robust growth of mobile internet in 2010, problems still abound. Services and applications are mainly run on 2G networks while the 3G network are under utilized due to cost and bandwidth limitations; many applications are limited to functional phone plus WAP access uses due to the high prices of smart terminals; a significant proportion of the users are of lower age, poor education background, and low income; the mobile internet vendors have a relatively poor profitability and lack a sound profit model.

2011: Improvement of platform businesses & focus on competition for users

In 2011, the 2G plus WAP-based mobile internet model will become outdated while 3G and www application-based networks will usher in a new era of mobile internet.

In terms of terminals and platforms, smart phones priced around RMB 1,000 or below will encourage users to shift from functional phones to smart phones. With its bigger screen and more fascinating way of operation, touch-screen phones are for a better match for mobile internet and will gain popularity; it is worth noticing whether the Android mobile operating system launched by Google in 2009 will outdo Symbian to become the No. 1 platform; Microsoft Windows phone 7 (Wp7) will make a comeback, and its clout is too big to be ignored; openness will become a major characteristic of the operating system platform.

As for application delivery, with improved bandwidth and cost affordability, bandwidth-sensitive services like video download, video call and real-time monitoring will gradually gain traction. While with improved payment regulations and market environment, mobile payment will become popular in 2011, where mobile phone recharge, credit card repayment, utilities payment, ticket reservations, public transport payment, movie ticket payment and shopping payment may be easily done via cell phones. Moreover, application delivery methods such as application stores and application warehouses are bound to go mainstream, and major vendors’ application stores will generate significant cash flow; the advertising business will also help ensure the lucrative prospect of mobile internet.

Another major characteristic of mobile internet in 2011 will be the intense competition for users, with user access to become the hot spot for competition among vendors. Only by controlling “the first entry” for users can vendors be successful in the cut-throat market competition, no matter whether it is in the case of terminals or applications, platforms or services, instant messaging or location services, browsers or input methods.

Source: CCID Consulting

Brazil: Promising Market for Mobile Payments

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With a penetration rate over 102%, Brazil has one of the largest rates of cell phones in Latin America. Despite of that, the mobile payment market in the country is still small, with few transaction  made through cell phone.

Nevertheless, due to the enormous potential of the mobile payment market in Brazil, all stakeholders involved in the means of payment landscape are currently focused on developing new mobile payment platforms and creating products utilizing cell phones as a means of payment.

The total number of mobile payment transactions in Brazil reached a total of 3.9 million in 2010. This number is negligible in comparison to the total number of transactions effectuated by credit and debit cards that reached a total of 5.8 billion transactions in 2010. With growth rates over 30 percent in the short term, the number of transaction is likely to reach 5.1 million by the end of 2011.

“There are drivers with high impact in the short and medium terms that are likely to leverage the usage of this payment model in the country. A considerable unbanked population in Brazil, increase on mobile payment solutions and bundling advantages to other services are the main ones”, explains Marcelo Kawanami, Industry Manager for Frost & Sullivan. The company has produced a report on Brazil’s mobile payment market, and expects the industry to take off starting in 2012.

Source: NewswireToday

Mobile Money: An Analysis of the Current Playing Field

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Mobile Money falls into three categories:

  • Mobile Remittance – Both domestic and international movement of value via mobiles.
  • Mobile Information – Almost exclusively limited to bank accounts one holds or has access to.
  • Mobile Payment – Authorization of payment for goods or services via 3rd party Debit / Credit systems – “the cards in your wallet on your mobile”

Mobile Payment is the utopia – But will any of these become common place? If so which and if not why not?

via GLG News.

Widespread Use of NFC Mobile Payments Still Years Away, Says Survey

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Sybase, Inc. subsidiary, Sybase 365, has released the results of its survey about leading inhibitors of widespread adoption of mobile payments.

According to the company, 40% of survey respondents cited the main inhibitor of widespread mobile payment adoption was a lack of coordination between key stakeholders, including mobile operators, merchants, payment processors, banks and developers.

“For mobile commerce to take off, industry stakeholders must harmonize their efforts in the same way that led to proliferation of SMS and MMS technologies,” said Marty Beard, President, Sybase 365. “In markets where multiple parties are working together, such as mpass Germany and paybox Austria, we have successful ecosystems where end users can pay for a multitude of goods and services via the mobile.”

While NFC will help further enable mobile payments, successful and established mobile technologies, including SMS and USSD are already leading the development of the ecosystem today.

“Mobile channels such as SMS, browser and apps are already being implemented by merchants globally. The challenge facing NFC is how to make the consumer payment experience significantly faster and easier than it already is.” added Beard.

Among 251 attendees polled at GSMA Mobile World Congress last week, 76 percent believe mobile proximity payments using NFC (Near Field Communication) technology is still at least two years away. Once again the lack of industry coordination (30 percent) was the cited as the main culprit for delayed NFC adoption. Other challenges included lack of NFC readers at point-of-sale (26 percent) and inadequate handsets (25 percent) were cited as inhibiting rapid deployment of mobile payments.

Source: Sybase 365

300,000+ Android Phone Activations Per Day, Says Schmidt

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According to Google CEO Eric Schmidt, more than 300,000 Android phones are activated every day, double the number of activations reported just six months ago.

Canalys reported that in Q4 2010 the Android O.S. was the world’s best-selling smartphone platform, dethroning Nokia’s Symbian from the 10-year top position. According to Gartner, Symbian is still slightly ahead on sales if some legacy non-Nokia Symbian smartphones are included in the Q4 2010 figures.

Android has a large community of developers writing application programs (“apps“) that extend the functionality of the devices. There are currently over 200,000 apps available for Android. Android Market is the online app store run by Google, though apps can also be downloaded from third-party sites. Developers write primarily in the Java language, controlling the device via Google-developed Java libraries.

References: GigaOm; Wikipedia

51% of Britons “Uncomfortable” at the Prospect of Contactless Mobile Payments, According to Survey

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A new poll by global research and technology firm Vision Critical shows that Britons are wary of mobile NFC contactless payments—with women voicing particular unease about the security implications.

Consumers are distinctly uncomfortable with contactless payments made through their mobile device. In the survey, half of respondents (51%) report being fairly or very uncomfortable at the prospect. Women are particularly skeptical; but there is a niche of young men and current smartphone users who support the practice.

More consumers trust banks to operate a mobile payment platform than card providers, mobile operators or handset manufacturers.

Two-in-five respondents (41%) favor debiting funds from a current bank account, while one-in-five (20%) would prefer a dedicated “mobile wallet” account for the purpose of making mobile payments. Mobile payments would decrease the use of cash and debit cards more than credit cards with one third of respondents (33%) saying they would spend a lot or a little less with cash and debit cards. One-in-five respondents (22%) would spend less on their credit cards with the advent of mobile payments.

“Mobile payments have been talked about for years, and it looks like they’re finally going to get off the ground,” said Mike Stevens, Head of Research at Vision Critical’s London office. “But a lot of people are clearly uncomfortable. There is a perceived security risk that will need to be addressed as services are rolled out. Banks could play a strong role here; they are generally more trusted by their customers than other players in the mobile payments game.”

Source: Vision Critical

Global Mobile Transactions Forecast to Reach $1 Trillion by 2014

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New research forecasts predict unprecedented growth in mobile transactions worldwide, with the total value of global mobile transactions increasing from $162 billion in 2010 to $984 billion in 2014.

The research was conducted by Yankee Group, a Boston-based  technology research and consulting firm.

While the overall dollar figures are impressive, the firm’s consumer survey results also show that less than 10 percent of respondents would be willing to pay extra for mobile transaction services such as mobile banking, mobile coupons and mobile payments.

“Every silver lining comes with a big, dark cloud and the explosion in mobile transactions is much the same,” said Nick Holland, senior analyst at Yankee Group. “Although mobile transaction service usage is increasing phenomenally, consumers show little interest in paying any additional fees for them. If banks, mobile operators, card networks and retailers want to tap mobile transactions as a revenue stream, they’ll need to come up with more creative schemes than per-transaction fees.”

Yankee Group’s mobile transaction forecast tracks metrics on mobile banking, international and domestic remittances, contactless cards, mobile coupons and NFC communications. Other forecast findings include:

  • Asia-Pacific overtakes EMEA as the mobile banking powerhouse: In 2010, EMEA leads all regions with 42 percent of worldwide active mobile banking users, followed by Asia-Pacific (38 percent), North America (16 percent) and Latin America (4 percent); but by 2014, Asia-Pacific leads with 54 percent, followed by EMEA (32 percent), North America (10 percent) and Latin America (4 percent).
  • Mobile coupon usage explodes: The number of active mobile coupon users is expected to grow from 2.7 million in 2010 to nearly 35 million in 2014.
  • Near field communications (NFC) takes off: The number of NFC-enabled phones will grow from just 834,000 in 2010 to 151 million in 2014, a CAGR of more than 300 percent. Similarly, the value of NFC-based transactions will explode from $27 million in 2010 to $40 billion in 2014.

The report is entitled:  “A View from the Trenches: What Consumers Think of Mobile Transactions.”

Source: Yankee Group.

Mobile Payment Markets: Strategies & Forecasts 2010-2014

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This report provides analysis of the entire mobile payment market providing case studies, vendor comparisons and forecasts for digital and physical goods payments, NFC payments and mobile money transfer & remittances.

For each mobile payment segment, the report provides five year forecasts for gross mobile payment transaction value in eight key regions. Through one-on-one interviews and 22 case studies across the mobile payments market, this report explores many of the live products and services and discusses how the sectors are becoming increasingly blurred as service providers are expanding their product offering.

This report discusses all the key issues affecting the mobile payments industry, including consideration of the impact of the growth of smartphones and mobile apps and how the market is likely to develop over the next few years.

Key Questions Addressed by this Report:

  • What is the size and growth of the total mobile payments market?
  • What are the key factors driving market growth?
  • Which segments of the mobile payments market growing the fastest?
  • What are the regional market sizing trends?
  • What are the strategies of the key mobile payments providers?
  • What are the strategies of key mobile payments vendors?

Key Benefits:

  • A unique analysis of the mobile payment markets including technologies, market characteristics and forecasts.
  • Practical analysis of emerging opportunities for vendors & operators.
  • Unique insight: interviews of leading players with significant experience of the mobile payment markets.

More information: Mobile Payment Markets: Strategies & Forecasts 2010-2014.