Recent EDC press releases:

Internet, mobile and contactless payments are expected to soar according to a new Advanced Payments Report from Edgar, Dunn & Company (EDC) in partnership with Payments Card & Mobile magazine (PCM).

The Advanced Payments Report 2011, sponsored by MasterCard Worldwide, is based on a review of the global payments landscape, surveys of payment industry stakeholder opinion, and discussions with more than 650 industry executives and thought leaders.

The report states that, on a worldwide basis, the greatest growth in payments over the next five years will come in 'advanced payments' – online, contactless card and mobile payments. It estimates that the global market size for internet or online payments will continue to grow and is expected to more than double to over $2000 billion by 2016.

But the greatest growth will come in mobile and contactless payments. The global market for mobile payments is expected to reach $680 billion by 2016, with that for contactless payments estimated to exceed $320 billion.

“Payments Cards and Mobile has been reporting on the global growth in Advanced Payments for a number of years now,” says Alex Rolfe, Managing Director, Payments Cards and Mobile. “This report validates the continuing emergence and success of new market entrants and the changing nature of the payments infrastructure.”

Of all the drivers for success, “executive commitment is perhaps the most powerful driver for pushing out a new payment product,” the report says. It adds that while many organisations undertake limited, partially funded and often half-hearted trials of new payment products, the really important element missing in many such initiatives is executive commitment and the allocation of the right levels of investment.

The stakeholder opinion survey identifies payment cards as the most important payment method for making payments online but recognises the need to allay customer concerns of potential security risks. For contactless payments, the report notes that lack of contactless point-of-sale (POS) terminal infrastructure is the most critical challenge to growth in payment volumes.

On mobile payments, the survey points to the general lack of cooperation between the banks and the mobile network operators (MNO) as a continuing issue that needs to be addressed. It also notes that both banks and MNOs must address the needs of consumers as well as merchants and design suitable incentives where necessary.

Samee Zafar, Director at EDC, said “Robust and secure mobile payment technologies are widely available. These can leverage existing payments infrastructure as far as possible thereby saving payment processing costs. What is now required is for payment services providers to develop advanced payment products that can be effective and successful in the marketplace.”

Ed McLaughlin, Chief Emerging Payments Officer, MasterCard Worldwide said “Mobile phones are at the centre of a fundamental shift in consumers’ everyday lives, as this report clearly demonstrates. The mobile phone is proving to be an essential driver for payments, particularly in the shift away from costly cash, and MasterCard is committed to working with all parties in mobile ecosystem to create compelling new consumer experiences. We’ll also continue to see areas like transit and other applications embrace contactless payment, and the move to enabling mobile handsets will certainly be a big part of that transition.”

The 2011 Advanced Payments Report offers interesting perspectives to help understand this rapidly growing market. The 40 page report is now available from Payments Cards & Mobile.

Download the Edgar, Dunn & Company Advanced Payments Report 2011 here