Tag: contactless mobile payments

UnionPay and China Mobile have come together and have now launched the latest system into the country.

According to the Xinhua News Agency in China, the latest reports from China Mobile and China UnionPay include the launch of a new mobile payments system that will be based on NFC technology.

This near field communication form of system has experienced significant struggles taking off in the West.

However, this latest system to enter the massive Chinese marketplace will be based on NFC technology for the transition of data from the smartphone of a consumer to a reader at the point of sale. Trusted Service Manager services for the management and provisioning of the system will be offered through a partnership in which both companies will cooperate.

This is considerable NFC technology news as UnionPay is the exclusive Chinese domestic bank card.

The NFC technology platform from UnionPay is the only domestic bank card that is available within the country. Furthermore, China Mobile is the biggest carrier in the country. At the moment, it boasts over 700 million subscribers.

A number of other Chinese banks will be taking part in this effort to introduce and broaden the use of NFC technology for mobile payments in the country. These participants include the Bank of China, China Minsheng, Everbright, CITIC, Shanghai Bank, GF, and Beijing Bank, according to the official news report.

The report also indicated that the NFC technology mobile payments system was ready for immediate launch and would be available right away in a number of cities across China. It indicated that the first cities in which this payment option would become available to smartphone consumers include Shanghai, Shenzhen, Beijing, Guangzhou, and Nanjing.

If this system is successful, this could be an extremely meaningful shot in the arm for NFC technology that has struggled to gain adoption in a number of other large markets, particularly in the West. There are a number of hurdles still standing in the way of the success of the transaction method, but the two companies in this partnership have remained confident that they will be able to overcome those challenges.

The latest research indicates that it makes up only 0.01 percent of the total in the United States.

According to a report that was just issued by Javelin Strategy & Research, mobile payments using contactless technology at the point of sale (POS) made up only a tiny sliver of the total volume in the United States in 2012.

The report indicated that this technology was used for only 0.01 percent of the total POS volume in the U.S.

The research data showed that the total amount spent over contactless mobile payments was approximately $500 million. At the same time, though, the report did not see a grim future for this form of smartphone based transaction. In fact, based on their predictions, things are looking bright in that area.

The forecast made by the report is that there will be an increase in mobile payments at a CAGR of 61 percent.

According to Javelin’s predictions, the compound annual growth rate that will be seen for mobile payments using contactless technology will be 61 percent this year. This will mean that the method will experience growth at a rate that is higher than any other method. In fact, it is predicting that this trend will continue over the next five years, and that in 2018, the total volume will have reached 5.4 billion. This will mean that it will make up 0.13 percent of the total POS volume in the United States in that year.

A Javelin industry analyst, Aleia Van Dyke explained this trend by saying that the point of sale market in retail is experiencing a very rapid evolution, as the popularity of smartphones and mobile payments takes off. There is a much greater expectation from consumers today, as they feel that the retail businesses where they shop should be providing an enhanced shopping experience while inside the walls of the store through the use of smartphones.

The rapid implementation of mobile payments and other transaction options such as prepaid and gift cards have helped with the adoption of other technology based options, among consumers, according to Van Dyke. As a whole, retail POS purchases last year brought in $3.98 trillion. The prediction for five years down the road is $4.2 trillion.