Mobile payments have evolved far beyond simple digital alternatives to cash and cards, becoming platforms that combine payments, loyalty, rewards, and personalized customer experiences. As technology companies enter the payments market, success increasingly depends on delivering value beyond the transaction itself. Amazon’s expansion into mobile payments highlights how competition is shifting from payment acceptance alone to creating broader commerce ecosystems that encourage consumer engagement and merchant adoption.
The entrance of Internet retail giant Amazon into the mobile payments space should cause concern among other mobile players, but it should not cause them to close up shop, according to Forbes columnist Erika Morphy.
There is a way for them to compete in the near term. In the longer-term some unexpected trends are poised to emerge that should ensure enough market space for everyone – everyone offering more than just basic payment acceptance technology that is — in this industry.
At this time, mobile payments don’t provide enough of a convenience to get people to switch over from cards. It is just as simple if not simpler, to swipe a card as it is to open up an application and tap or scan a phone at the point of sale. And with a card, the shopper does not have to stop talking or texting and actually interact with a clerk.
Successful programs do exactly with Morphy describes, which is providing a more complete service that goes beyond just a payment. While the increase in contactless adoption after EMV will doubtless help the growth of mobile payments, extra value will be required to get shoppers to truly change their habits.
The future of mobile payments will be defined by the additional value providers deliver rather than payment functionality alone. As consumers expect faster, more seamless shopping experiences, companies that combine payments with loyalty programs, digital commerce, and personalized services will be best positioned to drive long-term adoption in an increasingly competitive marketplace.
Overview by Ben Jackson, Director, Prepaid Advisory Services
To read the full story, go to Forbes.