Mobile Payment The New Norm
On the Brink of Worldwide Acceptance

The adoption of mobile phones is growing rapidly across the world due to the numerous benefits that these devices provide, the improvement in telecom and internet connectivity, and the declining handset prices. They have become something around which our daily lives revolve. One important area where mobiles had a significant impact on our lives is in the payment of goods and services, commonly referred to as mobile payment. Mobile payments are used to initiate, authorize, and confirm a currency exchange in return for goods and services. They are gaining immense popularity in the recent years because they are convenient, much cheaper, and more transparent.

Today, the payment landscape has changed drastically with numerous new players having entered the fray. Facebook, Apple, Google, PayPal, and others are looking forward to the replacement of cash, debit cards and other kinds of payment with software-based methods running on mobile devices.

Facebook, the US-based online social networking service company is set to provide its WhatsApp payment services to every part of India soon with the aim of winning a significant market share and expanding its reach. In collaboration with HDFC Bank Ltd., ICICI Bank Ltd., and Axis Bank Ltd., the messaging app processes the transfers. State Bank of India joins them after it has the required systems in place. Initially, Facebook was looking to rollout the complete service with four partners but later decided to proceed with three as its rivals were racing ahead.

“WhatsApp has a great starting point: a monopoly in chat,” said Vivek Belgavi, leader for financial technology at PwC India. “High engagement makes it a credible competition.”

The pilot version of WhatsApp Pay began with 1 million users in February 2018 and received rave reviews, threatening the market share of other platforms such as Google Tez and Alibaba’s Paytm, where the social networking feature is absent.

Google, the multinational technology giant entered the mobile payments market in India with the launch of its mobile wallet app called Google Tez in September 2017. Based on the Unified Payments Interface (UPI), the mobile wallet platform was built by the National Payments Corporation of India (NPCI). It is available on Android and iOS and can be used to pay for movie tickets, utility bills, and make other transactions online. Weighing 7MB on Android, the app works with a variety of Android smartphones in India. Moreover, iPhone users going as back as iPhone 4s will be able to use Tez.

Apple, another technology company recently launched its mobile payment and digital wallet service called Apple Pay in Brazil in collaboration with local bank Itaú. The app works with iPhone 6 or later versions and any Apple Watch. According to Itaú, the deal aims at reducing friction for customers, avoiding issues such as payment delays in retail outlets. Apple Pay witnessed 50% year-over-year growth in the US merchant adoption and is currently accepted at over half of all American retail outlets, including over two-thirds of the country’s top 100 retailers. The new payment service is currently available in 26 countries including Brazil, Australia, France, New Zealand, Taiwan, China, Denmark, United Kingdom, Finland, Canada, Hong Kong, Ireland, United Arab Emirates, Isle of Man, Italy, Japan, Jersey, Russia, Singapore, Spain, San Marino, Switzerland, Guernsey, Sweden, United States, and the Vatican City.