Mobile payments, already common in developing economies, are set to become bigger business in the developed world following the tie-up between payment service provider WorldPay and CellPoint Mobile, a provider of mobile infrastructure, retail and payment solutions to retailers.
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The two firms plan to make it easier for retailers to introduce mobile payment services for remote transactions.
According to market analyst IMRG, online business in the UK is likely to grow from £50bn in 2009 to £123bn in 2020. Online sales already account for 17% of retail sales, and this is expected to grow, along with the percentage conducted from mobile phones. Market analyst Juniper Research predicts the global mobile retail market will grow by 24% over the next four years to $12bn in 2014.
With the WorldPay-CellPoint deal, retailers are charged a customer transaction fee, the same as for other transactions. The exact fee depends on the type of card used and monthly account maintenance fee, said CellPoint CEO Kristian Gjerding.
The payment solution, demonstrated in New York this week, provides a secure, PCI-DSS compliant, web-based program that enables one-click remote mobile payments.
Gjerding said the lack of existing payment systems in developing countries had made it easier for them to adopt mobile payment systems. Developed countries had plenty of alternatives and vested interests, including concerns over account control, that have delayed the adoption of new systems. However, this was starting to change as smartphones became more capable and as customers' shopping habits changed, he said.
Card-based mobile payments are already widely accepted for travel and other small purchases, but the possibility of using near-field transponders in mobile phones increases the options for 'touch and go' payments.
The tie-up with WorldPay could also boost impulse purchases as shopping via smartphone becomes more widespread.
It will also allow retailers to experiment with mobile payment technology, possibly ahead of their traditional payment partners. CellPoint Mobile has developed a mobile enterprise framework that integrates the payment system into existing retail transaction applications. This allows IT departments to create and enforce an architectural, rather than a tactical approach to multichannel mobile/fixed solutions, Gjerding said.
WorldPay's head of e-commerce products, Gabriel Hopkins, said mobile payments were a key focus for the company.