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Mobile Payments (M-Payments) introduce new opportunities, as well as threats, to mobile operators, financial institutions and new industry players. But today there are very few reasons for the normal subscriber to use his handset as a wallet. To achieve mass take-up of M-Payment services, a combination of key elements needs to be in place, concludes leading wireless analyst Northstream in a new white paper on M-payments.

Picture shows the Northstream founder group.

- Services launched so far have seen both successes and failures. An example is Mint in Sweden. Mint was launched with high hopes to become a widely accepted payment method for shops, restaurants and parking fees. While the payment service in shops and restaurants may be considered a failure the parking fee payment is a service that has proved popular with users. This is primarily due to the increased flexibility it offers, the exact metering and the elimination of the need for small change, says Zack Uchovsky, Strategic Advisor at the leading wireless advisory firm Northstream.

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To turn Mobile payment into a success requires simplicity and usability of services, market knowledge and understanding, and teaming up with the right partners.

- Turning the ever-present handset into a wallet or a credit card has an obvious appeal to a number of players from banks to independent solution providers. But a number of challenges and obstacles have to be overcome for this to offer much appeal to the average users and merchants, says Zack Uchovsky.

- It should be clear that it is unlikely to be a “winner takes all” scenario, where, for example, mobile operators push banks out of business or vice-versa. We see the future M-payments market more as one where players act together, each taking a fair piece of the pie.