There are approximately 447,9-million mobile payment users worldwide, a remarkable evolution from coins being introduced in 700 BC, notes in the 10th century and the introduction of Western Union’s “credit card” in the 20th century, writes Charles Pittaway, MD of Sage Pay.
Now customers can choose from a variety of payments including in-app payments, mobile point of sale, and online payment services such as retail giant Amazon or Paypal that operate a global online payment system.
Africa has 52% of mobile payment usage in the world. In the continent alone, mobile payment solutions have revolutionised the way in which business is being done. The Kenyan M-Pesa app is an example of this.
Paying suppliers should be as straightforward as checking a bank balance online. There has been some resistance to mobile payment solutions, businesses are hesitant to invest in new point of sale devices or software implementations. Concern regarding losing insight into the consumer’s purchase behaviour if another party is handling the process also exists.
Despite the concerns, the advantages of mobile payment solutions, such as access to additional revenue opportunities, outweigh the perceived disadvantages.
Here are some advantages to mobile payments:
* Increase in sales: More mobile money users mean more customers. This contributes to the sales of a business.
* Lower costs: Merchants have lower costs to conduct business and conveniently get information that is useful for inventory and accounting management.
* Marketing: Mobility allows for marketing of a business to be done at hand on your mobile at any time. This also allows for quicker responses to strike a deal.
* Access: Mobile payments allow for quick and easy payment transactions from wherever you are situated to any bank account.
* Analytics: Mobile payment systems give business real-time data, which can assist in making decisions regarding inventory and stock-levels.
In emerging markets, mobile payment solutions now connect millions of people to the mainstream economy and we believe that customers should have the power to control businesses from the palm of their hand.
Customers occasionally get caught up in battles between banks and mobile operators in a market that remains highly unregulated. In many parts of the world industry standards remain a work in progress.
In addition, security concerns of mobile payments have been widely voiced. Merchants and customers fail to understand where and how sensitive data is stored and transmitted. However, the benefits of mobile payments outweigh potential risks by far and should be considered as a powerful tool to grow a business.