It’s official. Mobile wallets are here to stay—and they’re going places.
Statistics from an annual survey conducted by card issuing platform Marqueta lend credence to our statement. According to the survey report, lockdowns resulting from the COVID-19 pandemic drove consumers to adopt mobile wallets as a safe, easy, clean payment method. Slightly more than three-quarters (76 percent) of survey respondents said their use of mobile wallets had “increased to some degree” because of the pandemic; of these consumers, 45 percent noted that their use of mobile wallets “significantly increased” once COVID reared its head. But more tellingly, 90 percent of respondents to the survey noted that they don’t expect their mobile wallet usage to slow down once the pandemic is over (or has become an endemic).
Research on and projections about the size of the mobile wallet market make a strong case for our argument as well. Late last year, finance and investment firm Finaria predicted that the mobile wallet market would exhibit “massive” 24 percent year-on-year growth, reaching a value of $3.5 trillion by 2023. According to Zion Market Research, the mobile wallet industry “amassed returns worth nearly $101.2 billion in 2020 and is set to register profits of approximately $ 750.3 billion by 2028,” with a CAGR of almost 21 percent between 2021 and 2028.
As for mobile wallet usage, 64 percent of participants in Marqueta’s annual survey said they now use mobile wallets to make payments, up from 38 percent of respondents to its previous survey. More than three-quarters of respondents automatically add a new debit or credit card to their mobile wallet as soon as they receive it, “showing how mobile wallets have now become a more routine part of consumers’ lives.”
Older Consumers Join the Fray
But the overall increasing popularity and staying power of mobile wallets isn’t the only evidence that mobile wallets aren’t going anywhere and are, in fact, going places. For one thing, and contrary to what some—or many—merchants may assume, Millennials and Gen Z-ers aren’t the only consumers who have boarded the mobile wallet train. Admittedly, according to a report by eMarketer, Gen Z-ers are expected to account for more than 4 million of the total 6.5 million new users signing up for mobile wallet options annually between 2021 and 2025. Millennials will “continue to account for 4 in 10 new mobile wallet users” during this four-year span.
However, among consumers responding to the Marqueta survey, 45 percent of respondents ages 51 to 64 years old said they now use mobile wallets, up from a mere 22 percent of individuals who said the same in 2019. Of survey participants in the 35- to 50-year-old age group, a whopping 80 percent reported that they make payments with a mobile wallet, up from 39 percent who claimed the same three years ago.
Additionally, there appears to be increased recognition by consumers that mobile wallets are truly an attractive option. In 2019, 55 percent of individuals queried by Marqueta said they found mobile wallets to be “an easy, convenient way to pay.” A vast majority (92 percent) of participants in Marqueta’s most recent survey have come around to this way of thinking.
Moving Beyond Retail
Just as importantly, while retail is still a “big vertical” for mobile wallet implementation and usage, mobile wallets are fast taking hold in other markets. According to Allied Market Research, the energy/utilities segment is seeing “considerable” increases in the number of companies that have introduced a mobile wallet payment option since 2019. Atmos Energy and Direct Energy rank among players following such a direction. Healthcare, too, falls on this list, as does telecommunications.
Those mobile wallets now enjoy an increased presence in markets like energy/utilities, healthcare, and telecommunications isn’t entirely surprising to us given other statistics. According to a recent report from SpeedPay Pulse, 55 percent of U.S. adults said the “value the speed a mobile wallet offers to pay a bill.”