Revolutionizing the money transaction process with mobile payments

Do you realize that our pocket mobile phones have become our very reason for survival and some day they will be utilized to conduct money transactions? Right from shopping to conducting business operations, mobile payments do it all. Now mobile devices are substituting our leather wallets as well. Yes, we have entered a paperless era where most of the paperwork and human labor has been replaced by our mobile phones.

India has seen a phenomenal increase in the use of digital mobile wallets which has revolutionized the entire transaction process. The vision to create a cashless country, Prime Minister Narendra Modi’s step towards demonetization of Rs 500 and Rs 1000 currency notes has led to most of the ventures adapting this easy and secured mobile payment methods.

It has become imperative for business firms to adapt this modern technology to enter the next generation of payments via apps as the strength of cash is about to vanish in this digital world.

In the words of Jamie Turner,

“If you’re not using mobile marketing to attract new customers to your business, don’t worry- your competitors are already using it and are getting those customers instead.”

To understand the features, trends, pros and cons, it is crucial to get familiarized with mobile payments term first.

What is the mobile payment system?

Mobile payments can also be referred to as mobile money or mobile wallet. You can complete your monetary transaction using your smartphone, instead of making payments with cash, cards or cheques. This mode of payment service is operated under financial regulations. No need for you to carry your physical wallet now, when you have a mobile device handy.

What are the current trends observed in smartphone payment apps?

It is imperative to study the new trends of mobile wallet applications that have arise. You will get a graphical description of the modern trends in different next-gen payments infographics.

• Due to the user friendly features, mobile wallets have replaced our physical wallets. Consumers now prefer to indulge in cashless transactions. Recent Trends suggest that very soon this new mode of transaction will replace the age old method and paper currencies will soon become obsolete.
• It is predicted that by the end of 2017, fewer than 25% of in-store purchases will be cashless based transactions. COD mode of payment in shopping apps quite likely will cease to exist.
• The market for mobile payments is expected to rise more than $720 billion by the mid of 2017.
• The fear of monetary loss due to fraudulent activity has reduced due to the launching of new debit and credit cards that utilize cryptography like EuroPay, MasterCard, Visa, etc.
• Mobile wallet brands like PayPal, Google Wallet, Amazon Pay and Square Cash offer multiple services such as online payments, ticket booking, gifts, loyalty cards, coupons and the market is predicted to rise $142 billion by 2019.
• RFID has evolved into NFC. There is no need to download an app to conduct any transaction. Near field communication users can simply hold their devices to contactless payment terminals and make the payment. Eg: Visa developed a payment ring for athletes to wear during Olympic Games in Brazil.
• Bitcoin’s digital currency has more than $1.46 trillion circulation.

However, the new technology is not free of side effects. Before you indulge in cashless transactions through your smartphones, it is important for you to make a comparative study of the pros and cons involved.

Let us study the benefits drawn from mobile wallet apps

• Security: Mobile payment apps are a secure mode of transaction that will never disclose any of the personal data or card details.
• Privacy: Mobile payment companies never store any information, you feed into the system. Transaction is secure and confidential, remains between you, the bank and the receiver.
• Speed: It is undoubtedly a faster mode of payment and you require either to enter your pin or fingerprint.
• Create customer loyalty: Integrate incentive programs into the mobile payment app to grow customer loyalty and add value to them in return for increased revenue.
• Improved inventory tracking: It is easy to learn about consumer purchase behavior and thereby serve them in an improved way.
• Cheaper credit card swipe fees: Charge per transaction via e-credit cards is comparatively less than physical payment.
• Go away without your physical wallet: No need to carry cash and cards in your pocket wallet.

Brief view into the drawbacks

• Hardware incompatibility: Incompatibility issues have cropped up the free flow of this technology. You need to have an NFC reader but that is lacking in old devices.
• Cost: You need to have POS hardware to accept payment via mobile phones and that is not available at a lower rate.
• Device failure: Battery drain due to multiple usage of your mobile phone will hinder mobile transaction processes.
• Phone is prone to theft: You might end up losing your confidential data in case your phone is stolen.
• Difficult to read Terms & Conditions: It is important to study the Terms & Conditions before making any payment, but the size of the phone screen makes it difficult to read the same.

Let’s have a compilation of innovative payment processes

This section comprises of a list of innovative payment processes that have made our lives easier.

• Mobile wallets: A mobile wallet is a digital wallet that stores your credit card or debit card information on your mobile device. Use your smartphone, tablet or smartwatch, instead of using your physical plastic card to make purchases. Eg: Paypal, Apple Pay, Samsung Pay, etc.
• Digital remittance: It is a platform through which money transfer to a distant place is made simple and quick. Eg: Xoom, MoneyGram.
• mPOS: Mobile point-of-sale device is a smartphone, tablet or dedicated wireless device that serves as a cash register or electronic point of sale terminal.
• Bitcoin: A type of digital currency in which encryption techniques are used to regulate the generation of currency and verify the transfer of funds, operating independently of a central bank.

Summing up

The article has outlined the basic information that you need to have before you start using the mobile wallet apps for your monetary transactions.

This new technology has resulted in changing the buying habits of the consumers. Purchasers of different age groups differ in their utilization of the modern technology. It is important to study each individual’s behavioral pattern and the current technology trend of 2017.

If we have a partial glimpse of the entire concept, mobile shopping trends are gradually popularizing the concept of m-commerce and this is just a minute part of the entire ecosystem.

Nihal Mehta of Eniac Ventures, has stated that,

”The mobile device has become our communications hub, our diary, our entertainment portal, our primary source of media consumption, our wallet, and our gateway to real-time information tailored to our needs. The revolution is now!”

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