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CCUL Headlines: Industry Insights

Mobile P2P is growing, but FIs are losing the race

Wednesday, February 05, 2014   (0 Comments)
Posted by: The Financial Brand
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The percentage of smartphone owners making mobile P2P payments grew 30% in the last nine months, but traditional financial institutions are slipping up.

By Rob Rubin, Managing Director, Novarica

In January 2014, a survey on FindABetterBank asked smartphone owners whether they used their phone to make and P2P payments within the last 30 days. Overall, the percentage of smartphone owners who have made a mobile P2P payment grew by 30% from April 2013 to January 2014.

Banks and credit unions are losing the initiative. Most banks and credit unions treat P2P as a "bolted on” feature and it doesn’t receive a tremendous amount of marketing attention or promotion. As a result, the percentage of mobile P2P users using their banks’ or credit unions’ mobile P2P feature has declined, while competitors like PayPal and Google Wallet have grown.

PayPal continues to reach into banks’ domain. More and more consumers are using PayPal for payments. Currently, PayPal is the dominant player in mobile retail payments, they’ve nearly caught up to banks in mobile P2P and they’re also gaining ground in mobile bill payments.

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