Category: Mobile Payments

Small merchants have yet to show enthusiasm for mobile payments

Mobile commerce is having difficulty gaining traction among small businesses in the United States. According to the U.S. Census Bureau, these companies account for more than 90% of the businesses in the country, but they have yet to show significant support for mobile payments. Large retailers and banks, however, have become quite enthusiastic about mobile commerce, offering consumers services that allow them to manage their money and shop directly from the smartphones and tablets.

NFC technology proves somewhat unattractive for small businesses

One of the reasons that small businesses may not be supporting mobile payments is because NFC technology comprises much of the mobile commerce infrastructure. NFC technology allows digital information to be transmitted over short distances and it has become a powerful tool for the mobile payments space. Most prominent payment services, such as Apple Pay, make use of this technology in order to facilitate transactions, but this requires that physical merchants have an NFC-enabled terminal that is able to interact with this technology.

EMV standards may drive the adoption of mobile commerce among retailers

For small businesses, adoption of NFC technology may be too costly, which has stunted the growth of mobile commerce among some merchants. An alternative, however, is new Europay, MasterCard, and Visa (EMV) standards, which retailers are required to embrace by October 1. These standards allow all retailers to adopt new payment terminals that support EMV cards. This will allow retailers to also embrace mobile payments, because EMV-enabled cards will be associated with the payment services being used by consumers.

Small retailers have little interest in EMV standards

While small retailers will also have to adopt EMV-enabled terminals, many have yet to outline plans to do so, partly due to high costs. If retailers do not embrace the new EMV standards, they will be held liable for any fraudulent purchases that are made through their establishments. Once small retailers begin feeling the consequences of these fraudulent purchases, however, they are likely to adopt the standards and begin acquiring EMV-enabled terminals.

Paytm has received investment funds from the commerce giant, solidifying its position in India.

Alibaba Group Holding Ltd. has recently announced that it has made an investment into the company behind the Paytm mobile wallet in India, a startup called One97 Communications.

The Chinese online shopping giant revealed this news in a press release issued at the close of September.

The company has chosen to invest in the mobile wallet and online shopping site, sending Alibaba even further into the world of mobile payments. In India, this will also help the company to enhance its competitive position when compared to its rival, Snapdeal. One of its affiliates, Ant Financial Services Group, also made an investment into Paytm, back in February. It will also be joining into this most recent round of investments, said the press release on the matter. The funds will be used by Paytm in order to be able to boost its business and to place a focus on its technology, marketing and talent.

The specific terms of the agreement with regards to the mobile wallet investment have not yet been released.

That said, it is known that Alibaba and Ant Financial have made an investment of $680 million in order to boost their stake in the company from having been 25 percent to become a much larger 40 percent. Back in June, Reuters released a report that indicated that this type of investment could be worth more than $600 million, so the figures do align with what experts had been predicting.

According to the Alibaba Group CEO, Daniel Zhang, “India is an important emerging market with strong e-commerce potential.” He also added that “This investment will further expand Alibaba Group’s global footprint to India’s thriving mobile commerce market.”

This is an important market for Alibaba, which has been watching a slowing in the growth that it has been experiencing in its home country of China. As India is the fastest growing large economy on the planet, it appears to be the next logical step for a company the size of Alibaba. It is a move that is being made by a number of companies in the smartphone sphere, as mobile wallets, payment, and commerce rise in India.