• by Chuck Martin , Staff Writer, October 9, 2014

The coming increase in the number of people using their phones to pay for things has been obvious for some time.

One of the main reasons is that since most people don’t already use any form of mobile payments that it can only go up.

Apple, of course, is giving the prospects a boost with its Apple Pay, which at least guarantees that many more people will find out that they could pay by phone. Whether they want to, or will,  is another matter.

It’s not that mobile payments today aren’t happening.  Mobile payment transaction values are going to double last year’s to reach $3.5 billion by the end of this year, according to a new study.

And the next year, it will double again, and double again the following year, according to the eMarketer report US Mobile Payments 2014.

In two years, mobile payment transactions will reach $27 billion, according to eMarketer, as the number of people using phones to pay continues to increase.

By the end of this year, one in 10 U.S. smartphone owners (16 million people) will use mobile payments. In two years, 36 million people will be paying by phone and two years later it will be one in four smartphone owners.

One of most interesting aspects of the study that struck me is the coming transformation in how much money each person will spend by scanning, tapping, checking in or swiping their phones.

A major contributor to the projected growth in mobile payments is the shift from paying for low-priced goods and services under $20 (as in Starbucks), to medium-priced purchases like taxi rides (as in Uber) and restaurant payments (as in LevelUp), as well as high-priced purchases over $100, according to eMarketer.

By contrast, more than half (58%) of mobile payments made last year were for under $20, dominated by payments at Starbucks, with 15% of its transactions coming via mobile.

In two years, this model will be turned upside down, with most (57%) of mobile transactions coming from medium-priced products, 27% from high-priced products and only 16% from low-priced products, based on the eMarketer study.

Viewed another way, the average annual spend per mobile payment consumer was $143 last year, $220 this year, $397 next year and $759 in two years.

And it doesn’t stop there. By 2017, mobile payment consumers will use their phones to spend $1,314 each and $2,072 each the next year.

The bottom line is that more people will be using their phones as the way to spend their money.

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