Wednesday, 04 April 2018 23:43

Mobile wallets booming as Paypal leads the pack, but will QR codes or NFC win?

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With mobile wallets set to pass two billion users next year, and QR code payments soaring in China despite challenges elsewhere, who will cash in and win the digital wallet war?

The latest study from the analytical gurus at Juniper Research has found that "nearly 2.1 billion consumers worldwide will use a mobile wallet to make a payment or send money in 2019, up by nearly 30% on the 1.6 billion recorded at the end of 2017".

We're told the study claimed that "while contactless card payments were far more prevalent than NFC mobile payments in many markets, leading wallets were seeking to redress the balance by enabling both online and offline options".

"Meanwhile, a number of wallets, including Orange in France, have augmented payments offerings with banking services in a bid to deliver a holistic financial portfolio for consumers."

So, who sits atop the digital wallet leaderboard?

Well, Juniper's report, dubbed "Mobile Wallets: Service Provider Analysis, Market Opportunities & Forecasts 2018-2022," has the answers, with the report, as always, on sale to relevant parties at relevant prices.

The report "assessed the capabilities of, and prospects for, nearly 20 leading mobile wallets," and concluded that "PayPal, which has begun offering contactless payments instore in the US, had the greatest opportunities to develop a converged wallet on a worldwide basis, closely followed by China’s Alipay".

Leading global mobile wallet providers, Juniper leaderboard 2018

  • PayPal
  • Alipay
  • Weixin Pay/WeChat Pay

What about security issues being "likely to restrict QR code opportunities?"

Juniper's report "also argued that while QR code-based instore payments had seen quite astonishing levels of adoption in China, successful use cases in Europe and North America were likely to be limited to ‘closed loop’ wallets such as those deployed by Starbucks and WalMart".

According to the research, "the greater security offered by NFC-based wallets, which include tokenised credentials and, increasingly, biometric authentication, make them more attractive to both consumers and merchants".

As research author Dr Windsor Holden observed, "QR code based payments are likely to have significant growth in markets such as India and sub-Saharan Africa, due to the negligible implementation costs. However, their greater susceptibility to alteration to include viruses and phishing scams is likely to act as a major deterrent elsewhere."

As per usual, Juniper has more insights to share in its complimentary whitepaper, dubbed "NFC vs QR Codes ~ Which Wallet Wins?", which hopes to tempt you into acquiring the full research.

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Alex Zaharov-Reutt

One of Australia’s best-known technology journalists and consumer tech experts, Alex has appeared in his capacity as technology expert on all of Australia’s free-to-air and pay TV networks on all the major news and current affairs programs, on commercial and public radio, and technology, lifestyle and reality TV shows. Visit Alex at Twitter here.

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