Asia-Pacific has grown into the world's largest market for cashless transactions. Find out what are the top APMs here.
In an era where people are constantly on the go, mobile payments have emerged as the new way of making payments. As a result, online brokerage platforms are increasingly adding support for mobile payments in the race to address the more than 4 billion people completing transactions through mobile devices. By 2024, the globally forecasted mobile payment market size is predicted to be 3 trillion.
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Why Mobile Payments are Fast Becoming a Necessity
Mobile payments are becoming an essential aspect of the trading space due to the convenience they offer. As mobile sales grow, there is increasing demand for payment gateways that allow people to pay on online brokerage platforms from their handheld devices. In addition, mobile payments are prevalent among the young population, whose purchasing power is on the rise.
Millennials and Generation X are the key proponents of mobile payments as they account for the biggest share of the mobile market. While most of them are likely to do everything from their device, demand for online methods of payments should continue to grow. Mobile payments are also necessary for brokerage platforms as they avert the security issues associated with other modes of payment. Debit/credit card security concerns have continued to fuel demand for mobile payments.
The new payment methods come with strong encryption that also allows people to check out without handing over any of their details. Mobile payments are also becoming popular as they remove the friction during checkout, thus boosting conversion rates. In addition, they allow customers to checkout without spending extra minutes entering unnecessary details.
Want to know the 5 hidden costs faced by FX businesses with their payment processors? Download the guide to find out!
Types of Mobile Payments
Mobile payments are broadly classified into four types.
1. Near Field Communication (NFC) Mobile Payment
It is one of the most popular online payment methods whereby mobile devices work together with NFC-enabled point-of-sale systems to process payments. The two devices work together to pass encrypted information to each other, completing a mobile payment within seconds. Some popular options supporting NFC mobile payments include Apple Pay, Samsung Pay, and Google Pay.
2. Peer-to-peer Payments
The popularity of Peer-to-peer (P2P) payments as the preferred online method of payment is growing, given its convenience. P2P payment systems allow two users to transfer money to each other through a mobile app. Additionally, they let users make payments to merchants using the same network.
Trading businesses have started integrating peer-to-peer transactions supported by the likes of Venmo, PayPal, and Cash App, whereby people get to make mobile payments by scanning a QR code.
3. Browser-Based Mobile Payments
Such a payment system work by a user entering debit or credit card information and sometimes ACH banking data into the checkout page using a smartphone or tablet. The online brokerage platform will then process the payment based on the data entered.
4. In-App Mobile Payments
They are similar to mobile browser payments, with the only difference being that the transaction takes place in a mobile app instead of a desktop browser. Once the payment data from a credit or debit card is entered, the information is saved and used to process payments in the future.
The Benefits of Mobile Payment
Mobile payments are becoming increasingly popular to enable fast and easy transactions in the online brokerage space. All one needs to do is open their wallet app, scan a barcode or click the buy option and they are good to go.
Convenience
The convenience that mobile payments offer is second to none amid the digital revolution. Mobile payments have made it possible to complete transactions using preferred online payment methods at the click of a button on a smartphone or tablet while on the go.
As long as you have mobile payment apps such as Apple Pay, XanPay, or PayPal on your smart device, you can always make a payment anytime and anywhere.
Speed
Mobile payments stand out on their ability to finalize transactions within seconds. NFC, in-app, peer-to-peer, and other mobile payments store customers’ information through automatic systems, therefore able to make payments once authorization is given.
Security
End-to-end encryption has enhanced security levels on mobile payments, making them more secure than carrying credit or debit cards or cash. For example, online methods of payment secure bank details with tokens, a series of random numbers that is impossible to crack. On the other hand, peer-to-peer systems rely on bank-level encryption to secure users' data and money.
With mobile payments, it is difficult to steal customers’ data as no data is transferred between customers and merchants. Additionally, third-party gateways like PayPal require customers to log in before authorizing payments and rely on two-factor authentication for added security.
Bottom Line
Mobile payments are the catalyst fueling the online brokerage space given the convenience and efficiency on offer. As a result, it’s becoming the new trend as the preferred online method of payment, with almost half of all online shoppers using mobile devices to make purchases. As mobile payments for brokerage platforms grows, merchants need to understand how to integrate them and add support for all the most popular online payment methods to enable mobile payments.
If you are looking to leverage alternative payment methods such as mobile payments for your trading business then XanPay is an excellent option!
Read our report on the payment predictions for 2023 below!
Asia-Pacific has grown into the world's largest market for cashless transactions. Find out what are the top APMs here.
Asia-Pacific has grown into the world's largest market for cashless transactions. Find out what are the top APMs here.