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Are Mobile Payments Here to Stay?

PAI – Feb 15th, 2013

Mobile Commerce is here to stayAs the mobile device industry has grown, so has the interest in using these miniature computers to complete payment transactions. Mobile credit card processing allows merchants to receive payments for goods and services from an internet-connected mobile device, such as a smartphone or tablet.

Many people have already taken advantage of at least one of the three main forms of mobile payments currently supported in the payment landscape. These three forms include:

  1. Mobile person-to-person money transfers.
  2. Goods and services purchased over the internet on a mobile device.
  3. Payments initiated from a mobile device at a physical point-of-sale location (mobile credit card processing).


Each of these mobile payment forms offers consumers a more convenient and secure way to pay. For the merchant, mobile credit card processing:

  1. Reduces costs by allowing a merchant to take advantage of swiped, card present rates even when not at a traditional terminal.
  2. Speeds up transaction times compared to calling to authorize transactions.


The Future of Mobile Payments

While the mobile payment industry is still young, small merchants and individual sole proprietors stand to be the most impacted. They are the businesses most affected by the traditional fees associated with credit card acceptance. Mobile payments remove many of these fees, meaning more small businesses can afford to accept credit cards as a payment form. As consumer demand increases, the mobile payments landscape will also grow and allow merchants to sell more goods and services to a larger population.

There are many benefits to mobile payments, but they don’t come without caution. Currently, the biggest concerns with mobile payments are the risks and liabilities faced by the companies responsible for processing the payments. The likely solution to these risks would be an extension of the Payment Card Industry Data Security Standards (PCIDSS) to include standards specific to mobile payments. For more information on these standards, you can read our post on PCI Compliance.

Here at PAI, we've already seen mobile acceptance increase dramatically, both in terms of swiped transactions and internet purchases on mobile devices. We think it’s safe to say, yes, mobile payments are definitely here to stay. According to Wilson Kerr, VP of Business Development & Sales at Unbound Commerce, mobile internet purchases increased over 300% on Cyber Monday 2012 compared to Cyber Monday of the 2011 holiday season. This is a very large indicator that mobile payments aren't just a trend.

Are you using mobile payments for your business? Why or why not? Share your comments below, or let us know on Facebook or Twitter.


Tags: [Mobile] – [Credit and Debit Cards]