Paper checks are dying. Mobile payments are soaring. Credit cards will experience diminishing market share. And cash – old-fashioned paper money and coins – is a lot more resilient and ingrained in our lives than many might think.
Those are four big conclusions to draw from the “World Payments Report 2011,” a report just released by Capgemini, The Royal Bank of Scotland (RBS) and Efma (the European Financial Marketing Association).
Some of the numbers highlight the enormity of looming changes. Checks, for instance, accounted for 16% of non-cash global transactions in 2009 – down from 22% in 2005. And the number “continues to lessen,” per the report.
More numbers from the report: “Mobile payments will represent 15% of all cards transactions by 2013, and will overcome cards volumes within 10 years if growth continues at the same rate....The use of e-payments and m-payments is expanding, accounting for an estimated 22.5 billion transactions worldwide in 2010. E-payments are expected to grow globally from 17.9 to 30.3 billion transactions between 2010 and 2013... and m-payments from 4.6 to 15.3 billion transactions over the same period.”
“What this is all about is the ‘electronification’ of cash,” said Chris Fay, a payment and banking expert with Capgemini.
“The stars are aligning for mobile,” added Deborah Baxley, another Capgemini principal. She added: “Mobile payments now are real. There are no technological barriers remaining. “
She also saw a bright spot for the U.S. in terms of contactless payments adoption – “there are advantages to being last.”
Prices for contactless terminals are down, she elaborated, technical reliability is proven and, by now, “merchants are starting to clamor for it.”
“The United States,” Baxley added, “may be ready to leapfrog the rest of the world in terms of mobile payments.”
Added Baxley: “It’s about time for the check to die.”
As for cash – folding money and coins – that, she says, will be with us for many more years. “I don’t see it going away soon.”