Mobile Payments Are Eating The World
“Will that be by cash, credit, check … phone or watch?”
Francisco Gonzalez, BBVA Bank chairman, predicts his bank’s chief competitors in the future will not be the likes of Chase Manhattan, Bank of America or J. P. Morgan, but software behemoths like Apple, Samsung, Google and Amazon. The new emphasis, he says, is in mobile payments. “Mobile has emerged as the driving force for disruptive innovation in banking,” he said at the Mobile World Congress in Barcelona the first week of March 2015.
He should know. “The number of BBVA mobile customers has increased 14-fold in three years and totaled 4.3 million at the end of 2014,” he reported.
Not Your Grandpa’s World Anymore
“The days of carrying wads of cash and paper check books are quickly fading,” reports Nielsen Newswire in December 2014, in a post: Digital Money Management: Millennials and Boomers. “The world has gone digital, and payment methodologies are rapidly gaining prominence among savvy consumers.” The report goes on to say that these “savvy” consumers do “live with their smartphones, which means their high ownership rates could be a key to future use” in the mobile payments & banking industry.
Interesting enough, according to Nielsen, leading the pack in the digital, mobile payment revolution is the generation on whose watch the whole thing got started … the Boomers, who are now today’s senior citizens.
“The vast majority (92%) of mass affluent Boomers indicate online banking is their preferred channel for paying bills,” Nielsen reports. Comparatively, “about two-thirds (65%) of mass affluent Millennials pay bills online.”
Mobile Diginomics to Replace Physical Money?
In a Pew Research survey released on May 6, 2015, 64% of U.S. adults own a smartphone. 57% use their smartphones for online banking services. Fifteen percent claim to “have limited options for online access other than a cell phone.”
Even more succinct to the “Diginomic Age,” in 2014, according to Comscore.com, mobile app usage accounted for “half of all U.S. digital media consumption” and, in March of 2015, “the number of mobile-only adult Internet users exceeded the number of desktop-only Internet users.”
“Mobile transactions are estimated to reach $670 billion within about three years. Digital goods are expected to comprise about 40% of this digital market,” says AccessPaymentSystems.com. “In an ever-changing technological world, physical money and credit or debit cards may become obsolete. Easy to lose and easy to have stolen, these ‘old-fashioned’ ways of paying for goods and services may be going the way of the older trade systems.”
This is a multi-part series on our diginomic world by Wallace Wood.
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