Telecom Lead India: Mobile payment is becoming a major
revenue stream for the telecom industry.

The transaction values will cross $171.5 billion in 2012, up
61.9 percent from $105.9 billion in 2011.

The number of mobile payment users will reach 212.2 million
in 2012, up from 160.5 million in 2011.

“We expect global mobile transaction volume and value
to average 42 percent annual growth between 2011 and 2016, and we are
forecasting a market worth $617 billion with 448 million users by 2016,”
said Sandy Shen, research director at Gartner. 

Gartner said the mobile payments market will experience
fragmented services and solutions for the next two years. Technology providers
will have to cater their solutions to the local market that will be using
different access technologies, business models and partners, and under
different regulatory conditions.

SMS remains the dominant access technology in developing
markets.

Web/WAP is the preferred access technology in North America
and Western Europe where mobile Internet is commonly available and activated on
user devices.

Web/WAP access will account for about 88 percent of total
transactions in North America and about 80 percent in Western Europe by 2016.

Near Field Communication (NFC) transactions will remain
relatively low through 2015, although growth will start to pick up from
2016. 

NFC payment involves a change in user behavior and requires
collaboration among stakeholders that includes banks, mobile carriers, card
networks and merchants. In the meantime, ticketing, rather than retail payment,
will drive NFC transactions.

Merchandise purchases will drive transactions in North
America and Western Europe. These will include e-commerce purchases where users
buy online, as well as in-store purchases.

Major e-tailers such as Amazon and eBay have developed
strong mobile storefronts and have seen significant growth from the mobile
channel.

For in-store purchases, Starbucks’ Card Mobile app is now
being rolled out nationwide in the U.S., following a successful pilot program,
and Gartner expects a large number of merchants to introduce their own mobile
payment services, trying to emulate Starbucks’ success.

In developing markets, money transfer and airtime top-ups
will account for most transaction volume, and money transfers will account for
the largest portion of the transaction value because of the demand for secure
and efficient ways of storing and transferring money.

In developing markets, such as Africa and South Asia, users
can buy bus and railway tickets using a mobile payment service so that they can
secure tickets earlier where tickets are often in short supply.

Eastern Europe will see the highest user growth between 2011
and 2016.

Asia/Pacific tops all regions in the number of users,
followed by Africa. This also contributes to high transaction volume, where the
two regions combined will account for more than 60 percent of the global mobile
payments volume in 2016.

Africa tops all regions in transaction value throughout the
forecast period, benefiting from a higher proportion of money transfer
transactions that have higher value per transaction than other use cases. North
America is the third-largest region by value in 2016 and is twice the value of
Western Europe.

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