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¤13B AT STAKE. ARE YOU IN? The Mobile Payments Opportunity for Telcos
¤13B AT STAKE. ARE YOU IN?The Mobile Payments Opportunity for Telcos
We are witnessing a significant and inevitable shift in digital payments to mobile
commerce. Consumers are now spending more money and time on their mobile devices
than on their desktops and in stores. Yet, while telcos facilitate this move, only 3% of this
spend is actually billed by them. To gain a share of the mobile payments pie and avoid
being disintermediated, they must proactively add value to the payments process.
We predict that telcos can tap into a ¤13B opportunity in Europe in the next five years.
But, to ensure success, these companies must adopt mechanisms to improve customer
experience and maintain trust.
TELCOS CAN INCREASE THEIR MOBILE PAYMENT REVENUES AT LEAST FOURFOLD BY 2022 IN EUROPE.
PHYSICAL GOODS have already been bought over
mobile by more than half of users5, and will grow
— aided by one-click purchase and click & collect
trends.
DIGITAL GOODS are being bought by more than a
third of consumers today6, with millennials leading
the growth.
MOBILE BILL PAYMENTS will increase, with a
quarter of customers already paying their bills on
mobile4.
P2P3 MOBILE PAYMENTS will thrive, facilitated by
micro businesses and new partnerships such as that
between PayPal and Skype.
2022 OUTLOOK: MOBILE PAYMENTS MARKET SEGMENTS, EUROPE2
Total Mobile Payments Revenue
¤231B 2022
Digital Goods ¤80B
Tickets and Bills ¤42B
Physical Goods¤67B
P2P3 Payments¤42B
¤114B2017
¤231B 2022
HOW BIG IS THE MOBILE PAYMENTS OPPORTUNITY?We estimate that telcos’ slice of the European
mobile payments pie will almost quadruple, from
¤3.4B in 2017 to ¤13.3B in 2022. This is contingent
on these companies continuing to invest in
competitive initiatives such as developing merchant
relationships, expanding payment options and
enhancing customer experience.
MOBILE PAYMENTS MARKET SIZE (EUROPE)1 2017 VS. 2022
Telco Share ¤13.3B, 6%
Telco Share ¤3.4B, 3%
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TELCOS CAN FOCUS ON 3 KEY DRIVERS TO INCREASE THEIR STAKE IN MOBILE PAYMENTS
Consumers are now spending an average of two
hours per day online on their mobiles7 and have a
growing appetite for on-demand, search driven and
instantly fulfilled services.
By building strategic relationships with merchants,
consumers and technology platforms, major
disruptive players (such as Uber, Apple and
PayPal) deliver frictionless, real-time payments
to their customers. We believe that telcos have a
unique opportunity to drive mobile payments, by
taking payments, data management and seamless
fulfillment to the next level.
Fraud and security breaches pose a serious threat
to the shift towards mobile spend. In addition, poor
user experience throughout the payments process
leads up to 58% of consumers to abandon mobile
purchases9. Telcos will need to address these issues
to succeed.
TELCO MOBILE PAYMENTS MARKET DRIVERS
STRATEGIC INITIATIVES
MERCHANTS
EXPANDING PAYMENT
RELATIONSHIPS
OPTIMIZING CUSTOMER
EXPERIENCE
CREATING PAYMENTS SERVICE
INNOVATION
CONSUMERS TECHNOLOGY
Developing solutions for a frictionless mobile shopping experience
Unbanked consumers increasing payments through carrier billing
Biometric authentication and tokenization reducing payments fraud
Lifestyle services going cashless and via mobile apps (Deliveroo)
Shift to the Gig economy8 requiring rapid payments on the move (Airbnb, Uber)
Video and music streaming establishing on-demand culture (Spotify, Now TV)
Convenience and speed driving click & collect (Starbucks, Argos)
Wearables and IoT devices facilitating in-store mobile proximity payments
Carrier billing enabled in eWallets (Apple Pay, Android Pay)
In a new series of insight papers, we explain how each of these initiatives can be utilized
by telcos to derive revenues from third-party transactions, customer loyalty and cross-
channel technology use. Visit www.aciworldwide.com/mobilepaymentsopportunity and
sign up to receive your copy as each insight paper is published.
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© Copyright ACI Worldwide, Inc. 2017 ACI, ACI Worldwide, ACI Payment Systems, the ACI logo, ACI Universal Payments, UP, the UP logo, ReD, PAY.ON and all ACI product names are trademarks or registered trademarks of ACI Worldwide, Inc., or one of its subsidiaries, in the United States, other countries or both. Other parties’ trademarks referenced are the property of their respective owners.
THE MOBILE PAYMENTS MARKET IS SET TO DOUBLE OVER THE NEXT 5 YEARS. DON’T BE LEFT OUT.
Talk to us about how you can capture a greater slice of the mobile payments pie.
UP® eCommerce Payments™ solution
...AND WE HAVE THE SOLUTIONS TO ADDRESS THEM
AT ACI, WE UNDERSTAND TELCO PAIN POINTS IN PAYMENTS AND FRAUD
PREVENTION
Integrating value-added services
Increasing conversion
Expanding to new markets
Getting to market fast
Decreasing fraud
ACI ReD Shield® fraud prevention
ACI® PAY.ON® Payments Gateway™
WE ARE A TRUSTED PARTNER TO RETAILERS, BANKS AND TELCOS
AROUND THE WORLD
40+ YEARS INNOVATING PAYMENTS
17 YEARS SUPPORTING TELCOS
Chris Curd, Head of Telco Sales - Europe
+44 (0) 7884 262751
www.aciworldwide.com/telecommunications
FOR MORE INFORMATION:
This report has been prepared in partnership with Red Dawn Consulting
1 Red Dawn Consulting, DIMOCO, Juniper Research, Ovum, WorldPay 2 Red Dawn Consulting, DIMOCO, WorldPay, Forrester 3 Peer-to-peer payments are money transfers between non-business individuals4, 5, 6 Global Mobile Commerce Report 2016, IAB7 Average daily usage March 2016, U.K. users. Ofcom8 Labor market participants engaged in event-based employment or payment9 Mobile Money Report, MEF, January 2017
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