UK mobile payments will reach more than £1.2bn by 2020 as smart devices are on track to replace cards and cash, according to payments firm Visa.
The UK mobile payments industry is predicted to grow three-fold over the next five years, according to research from Visa Europe.
By 2020 60% of Britons will use their mobile devices to purchase at least once a week, and this surge will see an increase in weekly value spent using mobile devices, growing from £718.8m to £1.2bn by 2020. The average shopper will spend £27 per week using mobile devices by 2020, £10 more than is spent today.
But 24% of shoppers will spend more than £50 per week by 2020 - up from one in 12 today.
Paying in store with mobile
These statistics refer to purchasing items online via mobile devices, but nearly 50% of those said they were interested in using their smartphone to make payments in stores using the device’s near field communication technology.
This research should encourage retailers to be ready to accept mobile payments by ensuring their websites are mobile-friendly and adopting contactless payment technologies.
Jeremy Nicholds, executive director for mobile, at Visa Europe said contactless point of sale terminals is the best investment a retailer can make. He said the same technology is required to accept both contactless bank cards as well as mobile near-field communication transactions.
“If you are a retailer, contact your bank who can tell you what’s involved. It’s easy to install and gives your customers better, faster service, with fewer queues, and less potential for till errors or fraud.”
Nicholds said he actually thinks the mobile payments figures are conservative and Visa expects the adoption rate to be much higher.
“This is particularly true when you look at the growth in contactless usage, which saw European usage grow by two times and spend grow by three times over the last 12 months. Contactless and online commerce enhancements have been key in paving the way for the next generation of mobile payment technology. The environmental conditions are already in place to meet the demands and expectations for digital payments. It’s no longer a question of ‘if’ consumers will embrace this new way to pay – it’s when – and for us the next 12 months are when mobile payments become mainstream.
“We’re witnessing a huge surge in interest from consumers in the UK for faster and more convenient payment methods as mobile and online commerce technologies continue to evolve at pace,” added Nicholds.