The value of mobile commerce transactions conducted via mobile handsets and tablets will exceed $3.2 trillion by 2017, up from $1.5 trillion this year, according to a new report from Juniper Research.
The increasing popularity of mobile devices for bill payment is reflected in the fact that the mobile banking sector accounts for the lion’s share of transaction values over the next five years, with the treasury and corporate sector still lagging behind consumer uptake. Mobile website optimisation still remains a concern across all sectors, however, adds the report as it calls for better adaption to the mobile channel.
The Juniper report entitled ‘Mobile Commerce Markets: Sector-by-Sector Trend Analysis & Forecasts 2013-2017’ looks at a number of key industries for mobile m-commerce transactions, including retail, airlines and financial institutions (FIs). All these sectors are emphasising the importance of the mobile channel as an engagement, delivery and payment mechanism device, which is why the report focuses on them. Treasurers working in these sectors will likely have to get used to the growing prevalence of the mobile channel but it shouldn’t present any difficulties in being absorbed into standard procedures. For FIs it presents a growth channel. The activities of Visa and MasterCard in regard to near field communication (NFC) contactless certification (see the MWC 2013 show report here from our sister site bobsguide) is cited by Juniper as an example, alongside the airline industry’s wider electronic e-ticketing initiative, where mobiles can be used to board planes, as key developments in the area.
Mobile wallet services will also spur the market, concludes Juniper in its report. These apps are already providing first time financial access in many emerging markets to poorer individuals where the proportion of ‘unbanked’ adults sometimes exceeds 50%. In the same emerging markets, partnerships involving mobile money between OTT storefronts and mobile network operators (MNOs) – enabling payment via carrier billing – are enabling greater access to the digital economy.
There are still barriers to adoption, however, the report notes. “A significant minority of retailers have yet to optimise their sites for mobile,” explains report author, Dr Windsor Holden, when considering the hurdles to widespread adoption of m-commerce. “Unless retailers ensure a seamless, user-friendly mobile shopping experience, they will fall behind competitors who are already using mobile channels to enhance customer relationships.” The same could be said for banks, of course, which could be disintermediated if they don’t meet their customer’s expectations.
The report also looked at the lengthy Point-of-Sale (PoS) infrastructure replacement lifecycles that are prevalent in many shops and transport systems, highlighting a perceived reluctance to undertake expensive upgrades without a demonstrable return on investment. For banks, however, facing competition from Square, iZettle, PayPal Here and other PoS-payment settlement devices that can use a mobile device, doing nothing is not an option. Their existing payment infrastructure could be used as the ‘rails’ without any of the valuable customer data being available to them unless they act.
There are various ways for financial institutions to benefit from advanced technologies and business models provided by FinTech's. Whether a business' approach is radical or incremental, data management can help a company to increase their return on investment, argues André Casterman, INTIX.
Tim de Knegt, strategic finance and treasury manager for the Port of Rotterdam, discusses how he is using blockchain, the challenges he will face in his role of treasury over the next 12 months and the advice he would give to someone starting out their career in treasury.
As the May 25 deadline for Europe’s General Data Protection Regulation (GDPR) inches closer, many treasurers are being lumped with the task of ensuring their wider company is compliant.
Apps are a critical part of treasury's shift into mobile banking as 67% of treasury and corporate finance professionals said mobile banking services are of particular interest to them in a recent survey.