Skip to main content

Remote Mobile Payment Value to Reach $1.2 Trillion

Fintech startups and traditional financial service providers have seen significant upside opportunities in the payments sector. Smartphones are already an integral channel for eCommerce and Point of Sale (POS) payment transactions.

The global COVID-19 pandemic accelerated the transition to mobile phones for payments. Throughout the pandemic, mobile devices were facilitating payment transactions online and in-person -- e.g. while using the Internet to shop at retail sites, or on-premises by using a digital wallet via Near-Field Communication (NFC).

Remote Mobile Payments Market Development

According to the latest worldwide market study by Juniper Research, the value of biometrically authenticated remote mobile payments will reach $1.2 trillion across the globe by 2027 -- that's rising from $332 billion in 2022.

These transactions use biometrics, typically facial and fingerprint recognition, to authenticate remote mobile payments. This growth of 365 percent is driven by recent regulatory changes, with the introduction of Strong Customer Authentication (SCA) driving usage.

The new research study identified Original Equipment Manufacturer (OEM) pay solutions -- including Apple Pay -- as a driver of mobile payment biometrics adoption.

Juniper analysts urged OEM-Pay vendors to use their influence over smartphone design to enhance built-in biometric systems within devices and ensure that security is maintained as new threats emerge.

The SCA requirement of PSD2 (Second Payment Services Directive) has motivated financial institutions to implement biometric authentication. To meet this requirement, providers have capitalized on smartphone biometric authentication capabilities, accelerating the technology’s adoption.

The research study found that the volume of biometrically authenticated remote mobile payments will grow by 383 percent over the next 5 years, reaching 39.5 billion globally by 2027.

To maintain trust and reduce fraud, financial institutions are implementing step-up authentication, where certain transactions are escalated for biometric approval based on risk scoring. Therefore, vendors must offer multiple ways to authenticate, as well as develop new techniques to keep biometrics secure.

Juniper analysts found that facial recognition is paving the way for greater adoption of biometrics in mobile payments, with OEM-Pay solutions leveraging the near-ubiquity of facial recognition capabilities to provide easier checkout experiences for customers.

However, with the use of facial recognition increasing, the technology has become a target for malicious actors using advanced spoofing techniques, such as digital injection attacks.

Outlook for Mobile Payment Applications Growth

According to the Juniper assessment, mobile authentication vendors must prioritize the design and implementation of enhanced liveness detection, and anti-spoofing techniques, to combat the ever-evolving role of fraudulent players and ensure that security is not compromised.

Authentication for smartphone-based payments and access to services is typically achieved through a variety of means, often involving a PIN or password. And, mobile devices have already provided a variety of different forms of biometric authentication.

That said, while true password-less authentication hasn't reached widespread adoption, there's a surge in creating user experiences where passwords are masked -- such as biometrics used to unlock a password. I anticipate that this approach could gain increased adoption over time, thereby increasing growth.

Popular posts from this blog

Digital Talent Demand Exceeds Supply in Asia-Pac

Even the savviest CEO's desire for a digital transformation advantage has to face the global market reality -- there simply isn't enough skilled and experienced talent available to meet demand. According to the latest market study by IDC, around 60-80 percent of Asia-Pacific (AP) organizations find it "difficult" or "extremely difficult" to fill many IT roles -- including cybersecurity, software development, and data insight professionals. Major consequences of the skills shortage are increased workload on remaining digital business and IT employees, increased security risks, and loss of "hard-to-replace" critical transformation knowledge. Digital Business Talent Market Development Although big tech companies' layoffs are making headlines, they are not representative of the overall global marketplace. Ongoing difficulty to fill key practitioner vacancies is still among the top issues faced by leaders across industries. "Skills are difficul

Global Digital Business and IT Consulting Outlook

Across the globe, CEOs and their leadership teams continue to seek information and guidance about planned Digital Transformation initiatives and the most effective enterprise organization change management practices. Worldwide IT and Business Services revenue will grow from $1.13 trillion in 2022 to $1.2 trillion in 2023 -- that's a 5.7 percent year-over-year growth, according to the latest market study by International Data Corporation (IDC). The mid-term to long-term outlook for the market has also increased -- the five-year CAGR is forecast at 5.2 percent, compared to the previous 4.9 percent. Digital Sevices & Consulting Market Development IDC has raised the growth projection despite a weak economic outlook, because of vendor performances across 2022, growth indicators from adjacent markets, increased government funding, and inflation impacts. The actual 2022 market growth was 6.7 percent (in constant currency), which was 87 basis points higher than forecast last year, alth

Mobile Device Market Still Awaiting Recovery

The mobile devices market has experienced three years of unpredictable demand. The global pandemic, geopolitical pressures, supply chain issues, and macroeconomic headwinds have hindered the sector's consistent growth potential. This extremely challenging environment has dramatically affected both demand and supply chains. It has led to subsequent inflationary pressures, leading to a worsening global cost of living crisis suppressing growth and confidence in the sector. In tandem, mobile device industry stakeholders have become more cautious triggering market uncertainties. Mobile Device Market Development Operating under such a backdrop, the development of mobile device ecosystems and vendor landscapes have been impacted severely. Many of these market pressures persisted throughout 2022 and now into 2023, borne chiefly by the smartphone market. According to the latest worldwide market study by ABI Research, worldwide smartphone shipments in 2022 declined 9.6 percent Year-over-Year