Mobile payments and purchases increase in Italy
11 / 08 / 2015
Although Italians battle to give up on cash, and Italy is still far from the levels of electronic payment found in the rest of Europe, even in our country people are slowly becoming accustomed to new forms of payment – especially thanks to the development of transactions by smart phone.
The past year was an extremely dynamic and decisive year for the Mobile Payment & Commerce market around the world, with many important developments for the sector: Apple’s entry to the world of payments and the Host Card Emulation (HCE) solution promoted by Google gave the market a significant push.
Although Italians battle to give up on cash, and Italy is still far from the levels of electronic payment found in the rest of Europe, even in our country people are slowly becoming accustomed to new forms of payment – especially thanks to the development of transactions by smart phone. According to the Mobile Payment & Commerce Observatory at the Milan Polytechnic’s School of Management, in 2014 growth in the use of credit cards was a mere 1.6%, while “New” Digital Payment are driving electronic payment so much, that the weight of eCommerce, ePayment, Mobile Payment & Commerce, Contactless Payment and Mobile POS increased – reaching 12% of transactions made by card (+20% compared to 2013), and a value of about 18 billion Euro.
Growth will continue
This growth will continue in the coming years: according to the Observatory, the “New” Digital Payment market should increase by 7% every year between 2015 and 2017. The mobile remote purchase component is at the foundation of this growth, reaching 2.2 billion Euro in 2014, +55% compared to 2013.
The Mobile Remote Payment & Commerce of digital content in2014 exceeded 760 million Euro, driven by the world of applications, while Mobile Remote Commerce of goods and services (essentially represented by the payment of local public transport tickets, parking, telephone credit and bills) continues to increase, reaching 1.2 billion Euro, due to the increasing number of retailers that are activating sales initiatives by App or Mobile site, and also because Italian users no longer see Mobile as a mere channel for mobile purchases, but more and more as a convenient instrument even for more traditional purchases.
An impuls by NFC
Globally, a significant impulse was given to Mobile Proximity Payment & Commerce linked with purchases by NFC, also thanks to the launch of Apple Pay. In Italy, during the year, there were various commercial initiatives that involved banks and telecommunications companies in the front line on SIM-based NFC solutions. There were also solutions based on HCE software architecture (a cloud-based solution that allows a bank to launch its own Mobile Proximity Payment service on Android 4.4 telephones, regardless of the manufacturer of the terminal or the telephone operator). However, the Mobile Proximity Payment & Commerce market is still battling to take off, while Italians seem to be potentially ready, as they possess more than 12 million terminals compatible with NFC technology.
The results of the Observatory’s research on Mobile Payment & Commerce show that the Italian market’s potential has still not had the opportunity to reach full expression. In this scenario, the Government and Public Administration can play an important role in helping Italians grow accustomed to using their mobile phone (digital payment) or ePayment as payment instruments every day.
How? First, with a legislative intervention proposing incentives and increasing awareness in order to accelerate the development of digital payment in Italy. Another contribution may be derived from an increase in ePayment to Public Administration, in the wake of the Development Decree bis, which makes it obligatory to receive payments with electronic devices through the payment node promoted by AgID. Finally, the continuous development of e-ticketing solutions linked with public transport may support the growth of Mobile Remote Payment.
Even Europe can do its part: in Brussels, a shared document was presented by the Economic and Monetary Affairs Committee and the Presidency of the Council of the EU, marking a political agreement on the new proposal for a directive on digital payment services. The document – which must still be approved by the European parliament and receive the opinion of the EU Council – has two objectives: to increase the consumer’s options and to make transactions safer. The shared text also deals with the issue of the consumer’s rights to a refund, and the issue of any price markups on the cost of goods and services purchased due to the use of digital transactions.
Elena Di Simone
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