This is according to global market research firm TrendForce, which attributes the growth to smartphone brands Apple and Samsung making a big entrance into the mobile payment business.
Apple Pay and Samsung Pay have particularly been scrambling to China, which makes up a huge slice of the mobile payment market, says TrendForce. It adds the rival service providers both struck a deal with government-run Chinese bank-card payment processor China UnionPay earlier this year. This means Chinese iPhone and Samsung phone users will be able to make mobile payments this year, provided their models are of the latest generation with upgraded software, it points out.
TrendForce notes the rapid diversification of mobile payment services accelerated collaboration among the participants in the industry ecosystem; for example, financial institutions and telecom operators. This resulted in the formation of industry-wide standards and the maturation of related technologies.
"Service charges from banks, telecom operators and third-party payment platforms constitute an enormous business opportunity in the mobile payment market," says Kelly Hsieh, senior manager for mobile communication and end device research at TrendForce. "However, hardware and software developers also have significant roles in the industry."For instance, she explains, the take-off of the mobile payment has led to the rapid market growth of fingerprint sensor chips.
"Since Alibaba's Alipay and Tencent's WeChat Payment incorporated fingerprint recognition into their payment verification processes, the number of smartphones that come with a fingerprint scanner has risen. In fact, this biometric technology is now a standard feature in most mainstream smartphone models. We can expect over 40% of the smartphones worldwide will be able to read fingerprints by the end of this year."
The research firm believes the main battlegrounds for competing mobile payment service providers will be the banking and retail sectors.
It points out large international banks have been energetically building their mobile payment networks around the globe.
Hsieh says banks will be instrumental in choosing the dominant mobile payment method in this market. Additionally, the related technologies will expand into more applications and sectors if large banks lead the collaboration between financial service providers and retailers.
Our comments policy does not allow anonymous postings. Read the policy here