Published on the 18/10/2010 | Written by Newsdesk
Mobile payments in Asia-Pacific are expected to more than double to US$3.6b in the next five years…
In 2015, Frost & Sullivan estimates that m-payments could exceed billings of US$3.6 billion, at a CAGR (compound annual growth rate) of 14.8 percent (2010-2015).
Frost & Sullivan industry analyst Shaker Amin attributes this growth to technology innovations and operators’ initiatives – particularly with NFC (Near Field Communication) – as well as rising consumer demand in both the developed and emerging markets.
Its latest analysis in its 2010 Asia-Pacific Mobile Payments Outlook report of 18 Asia-Pacific nations including Japan finds that contactless payments via the NFC channel will increase in popularity to account for 23 percent of all m-payments in 2015, from only 12 percent last year.
The SMS method which accounted for nearly 82 percent of total transactions in 2009 will likely remain the dominant mobile payment channel till 2015, albeit dropping to about 67 percent by then.
Other payment channels such as WAP (Wireless Application Protocol) and DMB (Direct Mobile Billing) contributed small fractions to m-payments in 2009, with adoption levels not expected to rise through to 2015.
There is no specific breakdown for Australia and New Zealand but Japan and South Korea, having one of the most advanced mobile cultures in the world, lead the region in the adoption of mobile payments.
Developing markets show interest
The relatively less developed mobile markets such as China, India, Indonesia and the Philippines, where access to traditional banking services is highly skewed against the rural mass population, are showing rapid take-up of mobile banking services including person-to-person (P2P) transfers and remittances.
Even in emerging markets such as Bangladesh, Pakistan and Sri Lanka – although limited to mostly SMS-based bill payments and micro credit transfers – m-payments services are increasingly becoming popular.
The report says that these emerging markets also have good potential for mobile remittance services due to the large population of workers residing in other countries – Malaysia for example. International remittance sent out from the significant migrant worker population in Malaysia is a lucrative business. This is significant for Malaysian operators as this segment of the population also has high mobile penetration; more than 90 percent of all migrant groups have mobile devices.
In sharp contrast, despite having one of the highest mobile penetrations in the region, Hong Kong, Singapore and Taiwan have shown little adoption of m-payments to date. Contactless payments in these markets are primarily driven by the use of smart cards as opposed to m-payments. The report expects NFC will fast change this.
