Why 2016 Is the Year for Mobile Payments

| February 1, 2016 | Financial Management

Pay by phoneWith each year, consumers seem to become more reliant on smartphones, using them for everything from online shopping to getting home from the airport. Almost everything smartphone owners do can be charged to a credit or debit card, eliminating the need to worry about handing over cash or swiping a card, especially if their payment information is already stored. Using services like Apple Pay and Android Pay, consumers now can use their smartphones to pay at the register, whether they’re grocery shopping or purchasing a new TV at a big-box retailer.

Despite growing availability, however, customers still haven’t quite embraced mobile at the point of sale. While cash and personal checks may have finally taken a backseat to plastic, the migration from plastic to mobile has been sluggish. But as with any new technology, the adoption curve takes time. While we likely won’t see every customer paying by mobile in 2016, experts believe it’s the year the early majority will begin to get on board. Here are a few reasons 2016 will be the year of mobile payments.

Expanding locations. When consumers can only use their mobile payment apps at a few select locations, they’re unlikely to go to the trouble of setting it up and learning it. However, the popularity of Starbucks’ payment app shows that when it’s a location customers frequent often, they’ll look into it. In 2016, more merchants will join the already growing list of restaurants and retailers that accept mobile payments, encouraging customers to start participating.

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Better marketing. Everyone knows they can pay by cash and major credit cards at most locations. However, few realize that mobile payments are available as an option. Mobile payment providers will continue to find innovative ways to market their services and encourage customers to use them. Locations will also begin to let customers know they accept Apple Pay or Android Pay alongside their announcements that they accept MasterCard and Visa.

Convenience. If technology has taught customers anything, it’s that when they can save time on minutiae, they have more time each day to do the things they love. This includes skipping the ATM and heading straight to a favorite store or restaurant. As convenient as plastic has always been, the new chip-based cards take longer to go through the authorization process. While this has added a layer of security, it has also slowed down lines at registers. This could be the force that drives customers toward mobile pay.

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Easier peer-to-peer payments. The news that Apple recently filed for a patent for a text message-based payment solution demonstrates how convenient funds exchanges will soon become. Facebook Messenger and Google Wallet already offer this option. When friends can transfer money to each other using their smartphone, the next logical step is to use their smartphones to pay businesses, as well.

In a few years, paying by smartphone will likely be something consumers do automatically. However, first there will be a period of time where they try out the technology and gradually begin to use it at their favorite retailers. Mobile payment app companies are always looking for ways to make the technology easier to use and ensure it’s available wherever customers want to use it. 2016 will be the year of mobile payments because convenience, technology and acceptance will all finally converge.

Follow Ramon Ray on Twitter @ramonray.

Ramon Ray
Ramon Ray
Ramon is a small business evangelist at Infusionsoft, publisher of Smart Hustle Magazine, and blogs about technology and small business at He is passionate about helping small business entrepreneurs grow their businesses. Ramon is a bestselling author, journalist and freelance writer, and a frequent event producer, speaker and host. Ramon’s third book is the bestseller, “Facebook Guide to Small Business Marketing.” Ramon has shared the stage with Seth Godin, Daymond John, Guy Kawasaki, Simon Sinek, JJ Ramberg, Peter Shankman and other celebrity entrepreneurs. He interviewed President Obama in the President's first live Google Hangout.

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