Technology Fuels Greater Push Toward Cash-less Payments, Research Predicts

A combination of market ready and emerging technologies is aligning to drive a majority of consumer payment transactions from cash toward other payments methods including the Internet, mobile and contact less payments, a new report from TowerGroup predicts. "By 2015,

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A combination of market-ready and emerging technologies is aligning to drive a majority of consumer payment transactions from cash toward other payments methods – including the Internet, mobile and contact less payments, a new report from TowerGroup predicts.

“By 2015, a substantial share of consumer payments globally will have moved from cash to other payment mechanisms,” said Theodore Iacobuzio, managing director at TowerGroup’s executive research office. “Many of these new form factors are already being tested in broad consumer settings in countries around the globe – from contact less payment terminals and fingerprint recognition payments, to mobile and micro payment roll-outs.”

The report, “The Cashless, Cradles Society: Coming Soon to a Pay point Near You,” finds the total market for micro payments in the US to reach $11.5 billion by 2009, with almost $5 billion of that amount transacted via mobile phones. The global mobile commerce market is expected to become a major industry with revenues of $50 billion to $75 billion by 2009 – with global micro payments generating about $40 billion in revenue.

“The nature of payments form factors should ultimately be irrelevant to financial institutions, as long as they are willing to engage in innovative partnerships to keep up with both technology and consumer desires,” said Iacobuzio. “If they ignore the issue, however, they could lose the ball,” he warns.

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