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Mobile wallets poised for growth: A new research study

Two out of three US smartphone users have made a mobile payment in the past 12 months; two out of five have a mobile wallet on their phone; and one out of five has used one of the Pays (Apple Pay, Android Pay, Samsung Pay).

Only 1 out of 20 use it once a week or more, however, suggesting that we still have a long way to go before consumers leave home without their (physical) wallets.

These statistics are among the findings from the latest edition of our ongoing Study on Mobile Banking & Payments, which tracks consumer adoption of mobile payments. Findings are based on results from a January 2017 survey of 1,514 US consumers, age 18 and over, who have a smartphone and a banking relationship – writes Melissa Fox, Senior Manager, David Cencula, Senior Analyst and Laura Levy, Senior Analyst, specializing in Payments Strategy & Innovation at First Annapolis.

In addition to the top-line statistics, study results highlight several important—and sometimes surprising—trends in mobile payments:

1. Adoption of mobile payments and mobile wallets is mass-market.

  • While adoption of, and interest in, mobile payments and mobile wallets is highest among Millennials, it is by no means limited to younger consumers: 85% of respondents under 35 had made a payment in the past 12 months—but so had 36% of respondents over 65.
  • While adoption levels vary by age, reasons cited by non-users are consistent: (i) concerns about security and (ii) lack of a compelling reason to use mobile payments.

2. Adoption levels have plateaued.

  • Adoption of mobile payments increased dramatically over the past 18 months, but did not change significantly over the past six (see Figure 1).
  • This plateau was consistent across all categories of mobile payments, with no significant changes for any particular mobile payment type. Bill payment continues to have the highest penetration, followed by in-app/online purchases.
  • We observed a similar trend in the user base for Apple Pay:
    • Apple, with an 11-month head start, remains the dominant Pays provider: 34% of respondents with compatible devices have enrolled in Apple Pay, compared to 14% and 20% for Android Pay and Samsung Pay, respectively.
    • Apple Pay’s user base appears to have stabilized in the short-term, as growth of compatible devices has slowed and penetration and activation metrics leveled off.

Figure 1: Mobile Payments Adoption by Type
“Which of the following types of payments have you made using your mobile phone within the last 12 months?”
Longitudinal Comparisons based on Respondents Ages 18 – 54
Source: First Annapolis Consulting, Study of Mobile Banking & Payments (March 2017).

3. Usage is increasing.

  • While Apple Pay’s user base may be stabilizing, those using Apple Pay at least once a week continue to increase, with almost one-third of Apple Pay users now using it weekly, or even daily (see Figure 2).
  • 43% of Apple Pay users said that they use Apple Pay more now than they did when they first enrolled, due primarily to increased acceptance. Only about 15% said they use it less often.
  • Similar trends were observed for Android Pay and Samsung Pay, and user satisfaction levels are consistently high across all three Pays.
  • More than one-third of current mobile wallet users said that they would use a mobile wallet for nearly all their purchases—if they could.

Figure 2: Apple Pay ‘Frequent Users’
Use Apple Pay 1/week or More
Longitudinal Comparisons based on Respondents Ages 18 – 54
Source: First Annapolis Consulting, Study of Mobile Banking & Payments (March 2017).

4. Consumers want bank solutions.

  • The Pays are the most frequently cited mobile wallet, followed by merchant-specific wallets (Starbucks being the most popular), which many consumers use to supplement their Pays wallet and earn additional rewards.
  • Most respondents who have or are interested in having a mobile wallet solution say they don’t want multiple payment solutions: they want one. And nearly half of them—48%—say they want to get it from their bank (see Figure 3).
  • That preference is even more pronounced among non-users, who may not yet have a wallet because they are not comfortable with the options available in the market.

Figure 3: Mobile Wallet Provider Preferences
 Of those that prefer a single wallet:
“If you were to choose one provider of a mobile wallet app, which would be your preferred provider?”
*Includes Amazon, Facebook, Walmart, Starbucks, and wireless provider.
Source: First Annapolis Consulting, Study of Mobile Banking & Payments (March 2017).


Consumers may not be quite ready to leave the house with only a mobile wallet, and growth may be slower than anticipated, but we believe that mobile payments and mobile wallets are poised for growth:

  1. Consumer use is increasing and satisfaction levels remain high.
  2. EMV migration is helping (and will help) to bolster mobile point of sale payments, both because it will increase merchant acceptance, and because it will create a customer experience advantage for mobile payments—real or perceived—when it comes to transaction speed.
  3. Adoption and usage among younger consumers is high, and growth will occur naturally as generations age and younger consumers mature.

Merchants and issuers will each play important roles in the long-term success of mobile wallet payments. Most consumers now have access to a payments-compatible device, and most large and mid-sized issuers have enabled their cards for mobile wallet provisioning. Merchant acceptance at the point of sale, however, continues to lag. Further enablement of contactless terminals will be required before consumers can rely on the ubiquity of mobile wallet payments.

Issuers have played an important role in mobile wallet provisioning to date, but we see an opportunity for them to play a larger role in mobile wallet payments. There is an opportunity for issuers if they can integrate mobile wallet capabilities into their mobile banking solutions, and we expect more investment in this area, both from large banks with proprietary wallets and smaller issuers leveraging white label solutions. Given consumers’ concerns about security and the natural synergies between bank brands and consumer trust, we think mobile wallet functionality delivered under an issuer’s brand will open doors for new and existing users. As with other successful payments innovations, the more consumers who have mobile wallets and the more places they have to use them, the more rooted mobile payments will become as part of everyday life.

Released in March 2017, the Study of Mobile Banking & Payments: Mobile Wallet Report is available for download at

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