More than 101 million Americans over the age of 14 will use in-store mobile payment apps to make purchases this year, up from 92.3 million last year, according to recent research from eMarketer (tip of the hat to TechCrunch).
The research firm said this milestone follows 29 percent year-over-year growth for mobile payments in 2020, and that usage is on track to surpass half of all smartphone users by 2025. Additionally, eMarketer predicts that the average annual spend per user will grow 23.6 percent to $2,439.68 this year, and will break $3,000 by 2023.
EMarketer attributes this growth in point-of-sale mobile payment adoption to the pandemic, as consumers sought out contactless retail experiences. This desire to minimize the number of touchpoints when paying for stuff translated into an acceleration of user and transaction value growth.
EMarketer forecasting analyst, Osar Orozco at Insider Intelligence said that the greatest increase in new users were Gen Z and millennials. “We project that there will be around 6.5 million new mobile wallet users per year from 2021 to 2025, of which more than 4 million will be Gen Zers. Millennials will continue accounting for around four in 10 mobile wallet users, although that share will shrink,” Orozco said in an eMarketer blog post.
Among the mobile payment systems, Apple Pay is tops with 43.9 million users in 2021. EMarketer says that Apply Pay will add 14.4 million users between 2020 and 2025. Starbucks is in the number 2 spot followed by Google Pay.
All of this tracks with what we’ve seen from the foodtech world over the past year. Big retailers like Walmart and Amazon’s physical stores have been upgrading their contactless payment options. The Apple Clips feature makes mobile payments easier by not requiring a full app download for every different store you want to buy from. A number of third-party companies were quick to bring contactless payment options to restaurants throughout last year. And even vending machines fast-tracked adoption of contactless payment methods.
Despite all that progress, eMarketer says that there are two factors that still hamper even wider adoption of mobile payment systems. First, setting up mobile payments remains complicated for many users, and many smaller businesses can’t afford the hardware and software necessary to enable mobile payments.