The use of mobile peer-to-peer payment apps, such as Venmo, in the US will continue to experience double-digit growth through 2021, according to eMarketer’s (www.emarketer.com) latest mobile banking/payments forecast.
The transaction value of mobile peer-to-peer payments in the U.S. will grow 55.0% this year to $120.38 billion, notes the research group. Transaction values are on pace to double by 2021. This year in particular, growth of P2P payment apps will largely be driven by the rollout of Zelle, a network of more than 30 banks and credit unions that will allow banking customers to transfer money to others within the network. It will be rolled out over the next 12 months.
“Mobile P2P payments have been driven by the desire for convenience, on-demand payments and the widespread adoption of smartphones,” said eMarketer forecasting analyst Cindy Liu. “Strong double-digit growth is expected in both users and transaction volume as consumers become more familiar and comfortable with mobile payments and as more players enter the market.”
This year, 63.5 million U.S. adults will use a P2P payment app at least once a month, which equates to nearly one-third (32.6%) of US smartphone users.
Meanwhile, mobile payment apps, such as Apple Pay and Google Wallet, are being adopted in smaller numbers in the U.S. This year, the total transaction value of mobile payments will grow 78.1% in the U.S. to $49.29 billion. Average spending per user will reach $1,026, cracking $1,000 for the first time.
Due to the long-established use of credit cards in the U.S., mobile payments will not see widespread adoption in the near future. This year, 48.1 million Americans 14 and older will have used a mobile payment app at least once in the past six months. While that’s nearly 1 in 4 (23.0%) smartphone users, that figure will only grow slightly to 30.8% by 2021.
“There are two main reasons mobile payments have not yet taken off in the US,” said Liu. “On the merchant side, not enough have implemented the technology to process the payments. On the consumer side, many Americans are simply happy with their existing payment methods and don’t see a need to switch.”
In contrast, China – where credit card usage is not as ingrained in commerce – leads the world in mobile payment usage and penetration. This year, 247.9 million people in China will use a mobile payment app, or 45.0% of smartphone users. By 2020, nearly half will do so.
eMarketer’s forecasts and estimates are based on an analysis of quantitative and qualitative data from research firms, government agencies, media firms and public companies, plus interviews with top executives at publishers, ad buyers and agencies. Data is weighted based on methodology and soundness.