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Mobile payments will increase in the coming years, but some questions still unanswered

December 28, 2012

Smartphone-based transactions saw a rise in popularity in 2012, particularly around Thanksgiving weekend, which includes Black Friday and Cyber Monday.

Smartphone-based transactions saw a rise in popularity in 2012, particularly around Thanksgiving weekend, which includes Black Friday and Cyber Monday. Merchants are feeling pressure from consumers when it comes to adopting new payment technology, and it is likely that consumer demand will drive retailers’ decisions on mobile pay. At the same time, there are impediments to more widespread use including adoption costs, a lack of full integration and security concerns. As businesses set budgets for merchant services in the new year, the risks and rewards of mobile transactions should be considered.

Companies might be considering adding mobile payment options, either through readers attached to point-of-sale (POS) systems or networked through clouds. A large consumer demand among target markets is apparent, and with more consumers using apps for nearly everything, mobile transactions are likely to change the way business is done in the coming year. At the same time, connecting smartphones with networks or clouds can cause faults in security. Because data can be compromised and viewed by third parties if proper encryption is not in place, concerns about security may not bode well for merchant fraud protection.

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