While more consumers are being empowered to pay by mobile phone, the actual way they will pay is hardly decided.
On one side is paying by QR code, as in payments at Starbucks.
On the other side is tapping a phone with NFC (near field communications) inside, as in Google Wallet.
The reason this matters is the coming growth in the amount of money moving through mobile.
Mobile in-store payments will grow from $2 billion last year to $189 billion in four years, based on a forecast report today from Business Insider Intelligence.
While it’s a relatively small percentage of overall in-store transactions, it’s still a significant and constantly growing pool of transaction dollars.
The two new twists in the mobile payments landscape are the introduction of Apple Pay and the coming introduction of payments by the mega retailer consortium Merchant Customer Exchange (MCX).
Most people still have never made a mobile payment in a store, the report notes, and those who do tend to be between 18 and 34 years old. More people pay with Android phones more money is spent via iOS devices.
While QR codes lead payments today, courtesy of Starbucks, NFC payments ultimately will win out, according to BI Intelligence.
The report suggests NFC has the momentum, since most Android phones already are NFC-compatible and NFC is inside iPhone 6, now usable at more than 200,000 merchants.
However, not to be underestimated is the coming payments platform of MCX, whose member merchants represent more than a fifth of U.S. annual retail sales.
Most MCX payments, called CurrentC, do not require any merchant hardware upgrades and will allow merchants to see the consumer’s entire purchase cycle at their stores, according to BI Intelligence.
No matter whether NFC or smartphone code payments wins the day, the activity of paying with a smartphone is going to be heavily promoted and highly visible to consumers, whether they want it or not.