New Report Lists 2014 Payments Industry Predictions

January 15, 2014 – BI Intelligence recently offered its payments industry forecast for the New Year. They this list based on their own analysis and along with predictions repeatedly cited by top trade publications and analyst reports.

Here is a summary of their report:

Bluetooth Low Energy will conquer retail. BLE can be used for payments, peer-to-peer transfers, and can enable notifications for marketing or loyalty programs.

Bitcoin hype will die down, and more will use it for what it was meant for — a means of global exchange. Bitcoin’s price fluctuation will continue over the next year, as will debate on its technical value, but BI Intelligence says, “one thing will change: People will no longer talk just about Bitcoin’s price, and they’ll start to see it for what it was always meant to be: an online instrument for powering transactions and moving value”.

Amazon will try to make friends with offline retailers, and offer them a payments platform. “We think there is a good chance Amazon will release a competitively-priced payments solution targeted at bricks-and-mortar retailers sometime in the next year”, says BI Intelligence. They anticipate that bricks-and-mortar-retailers would be inclined participate because Amazon may be able to offer insights on consumer behavior and possibly very low credit card processing fees.

The payments industry will consolidate and mature at a rapid pace, with a bevy of acquisitions and a handful of IPOs, including Square’s. “The initial disruption in online and offline payments has already taken place”. BI Intelligence anticipates that 2014 will present an accelerated streamlining of the payments industry.

Carrier billing is going to explode in emerging markets. Direct carrier billing addresses the issue of access for the under-banked by allowing mobile users to add purchases to their mobile bills. BI says, “Demand and lack of competition in these markets is going to lead to a bonanza, and big carriers in developed markets would be wise to increase their exposure to markets where carrier billing might take off”.

Square will sputter as it tries to grow its point-of-sale market share and cross into e-commerce. Square succeeded in powering transactions for small and medium-sized retailers with its software and simple hardware which allows Smart phones and tablets to act as cash registers. BI insider says the company will have difficulty further increasing its market share and, “will struggle to achieve the same level of growth as it has achieved in prior years”.

The mobile wallet is going to be dramatically reconceived. Only 11% of people in the United States have used a mobile wallet, defined as an app or mobile site that collects a consumer’s payment information and credit card numbers and helps them transact offline and online, according to Forrester. BI Intelligence says at this point, “Credit cards are still easier; We think mobile wallets will succeed if they reinvent themselves as all-in-one apps that will integrate all of a consumer’s shopping and finance needs into one place”.

Retail banks will also compete for mobile and online audiences with beefed up personal banking apps. Increasingly, more banking is taking place outside of physical banks. Therefore, BI Intelligence says that, “In order to differentiate themselves from competitors, banks will become interested in offering apps that go beyond just simply checking your balance, paying your credit card, and remote check deposit. They will try to build all-in-one multi-device payments and finance platforms similar to the mobile wallets described above”.

Mobile commerce will account for a third of holiday shopping in 2014. BI Intelligence found that, “Mobile commerce accounted for around 20% of e-commerce sales during the Black Friday weekend this year”. They anticipate that number will escalate in the coming year.

Read the full report at: http://www.businessinsider.com/the-big-digital-payments-trends-in-2014-2014-1#ixzz2qOnC403B

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