Proximity mobile payments in the US are set to ramp up aggressively. Transaction value will triple in 2016 due to a growing user base, broader merchant acceptance and the greater frequency of consumers using their phones to make point-of-sale payments on medium- and high-priced products.
As the barriers to using mobile phones to make point-of-sale proximity payments gradually go by the wayside, eMarketer estimates that both users and transaction values will undergo aggressive gains over the next several years, as explored in a new report.
The total value of US proximity mobile payment transactions will more than double in 2015 from the year before to reach $8.71 billion. Though that’s impressive in itself, it is anticipated that 2016 will be an inflection point for mobile payments in the US, with transaction value tripling to $27.05 billion.
Value will more than double in 2017 and grow in excess of 80% through the rest of the forecast period. By 2019, the total value of mobile payment transactions in the US will hit $210.45 billion.
To put this into perspective, proximity mobile payment transaction value will exceed retail mobile commerce sales in the US by 2019. In 2019, $149.79 billion will be spent on mobile commerce – products or services ordered using the internet via mobile devices, including digital goods (e.g., purchasing a paid app) and physical goods purchased remotely on smartphones and tablets that are delivered at a later date (for example, purchasing shoes on a mobile website or app).
The result is even more striking considering that just 40.5%, or $60.66 billion, of retail mobile commerce sales in the US will come from smartphones by 2019, whereas virtually all mobile payment transactions will come from smartphones.
One caveat: retail mobile commerce sales estimates exclude mobile travel sales, which we anticipate will reach $94.80 billion in the US by 2019. Combining total US retail mobile commerce and mobile travel sales in 2019 amounts to $244.59 billion – making it larger than proximity payment transaction values in the same year.
Nonetheless, if proximity mobile payments continue on the same trajectory of high double-digit growth beyond 2019, transaction values will likely eclipse combined mobile commerce and travel sales shortly thereafter. Consider that by 2019, eMarketer expects that slightly less than 10% of total retail sales in the US will come from ecommerce and just 2.7% of total retail sales will come from mobile commerce.
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