Chinese consumers are not even used to paying with credit cards in most locations, but according to a report by Deloitte in Beijing, mobile payments will become the main transaction approach in China by 2015. Starbucks recently made a deal with Square and McDonalds with Paypal to cooperate on mobile payments in other markets, and it is estimated that in the future, people will swipe their mobile phones to accomplish the functions of a credit card.
The market for mobile payments is expected to grow in the coming years, according to Innovation Works’ CEO Kai-Fu Lee in a recent speech at a conference about SAP business. Mobile phones will be more convenient for people when going shopping, and this brings in large opportunities for business. According to data from iiMedia Research, transactions for mobile e-commerce in 2011 reached 15.67 billion Yuan in China, and they are estimated to reach 25.15 billion by 2012, an increase of 609.0%. Some even estimate that by 2015, the scale will exceed 100 billion.
Although the domestic mobile payment market shows big potential, development is still in its infancy with a low penetration rate and many immature business models. Additionally, there are some obstacles—-especially related to convenience and safety—that will deter users from using mobile phones for the time being.