The Rise Of Mobile Wallets: Welcoming A Cashless Society
Markets of today have become more competitive than ever. Standing out among one’s competition has become more challenging each day. For companies, one powerful tool to explore is convenience. In fact, the latest Consumer View report of the National Retail Federation showed that around 83% of consumers consider convenience as a more important factor now compared with five years ago. Approximately 52% said convenience had influenced half or more of their purchases. But what about cyber security with convenience?
Going Mobile
Continuous innovation for convenience brought us mobile phones. In 2021, 5.22 billion people use mobile phones. That number is seen to grow to 7.3 billion by 2023.
But gone are the days when their only purpose is to help us communicate through calls and messages. Now, mobile phones have become part of the daily lives of many. They can be used to browse the Internet, connect on social media, and even make payments.
Mobile Wallets
The COVID-19 pandemic has impacted lives and businesses. With the need for safer interactions and transactions, more people moved to the use of mobile wallets. Aside from convenience, making digital payments offer a safer way to complete transactions.
Finaria highlighted this development in its report. According to Finaria, the global mobile wallets market in 2018 totaled $755.6 billion. After 12 months, it saw a 90% increase and reached almost $1.2 trillion.
Mobile wallet users reached 901 million globally in 2019. That is expected to reach 1.5 billion in 2021 and 1.7 billion by 2023. The number of mobile POS payment users also saw a rise in 2020, hitting the $2 trillion benchmark. The surge occurred amid the pandemic outbreak. That value is expected to increase further by half a billion in 2021.
Challenges Faced With Cyber Security
Data trends show a shift towards a cashless society. In 2020, around 86.5% of Americans checked their bank accounts through their mobile devices. Within the same year, about $503 billion dollars were sent out as payments using a mobile device.
However, with the convenience that mobile wallets offer comes challenges. Among them is cyber security. Since 2015, there is an increase in mobile app fraudulent transactions. The rise in such cases was over 600%. In 2019, there were 14,392 breaches recorded. These resulted in more than $40 million in losses. Of the total digital fraud losses, 89% were due to account takeovers.
Forecasts for mobile wallets see an upward trend. The U.S., which currently ranks second in terms of mobile payments market size, has $465.1 billion worth of transactions. The following years are expected to show an estimated growth of 49% or a total value of approximately $698 billion by 2023.
Strengthening cyber security for mobile wallets, such as through the use of biometrics or multi-factor authentication, will not only ensure safe transactions for you and your clients but will also help prepare you for a cashless society.
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