The increasing adoption of mobile payments in Europe — and remaining challenges to growth

Carlo de Meijer, Senior Researcher, Market Infrastructures and Jonathan Bye, Senior Consultant, Market Infrastructures, Royal Bank of Scotland

Abstract
Europe, the long-time laggard in mobile payments, is suddenly exhibiting encouraging signs of building the necessary infrastructure and piloting a variety of mobile payment initiatives. There are growing signs that the conditions for mobile payments in the European region to take off have improved. There is an increasing sense of urgency and willingness among the various players to pilot and invest in the mobile payments market in Europe. Europe has experienced growing activity in the mobile payments arena in the past 12 months. This is mirrored by the increased number of trials and, pilots in the space of mobile payments by vendors, retailers, transit authorities, mobile operators and banks. Thereby, they are increasingly using Near Field Communication (NFC) technology or NFC bridging technologies. While the infrastructure for mobile payments is falling into place, various challenges to widespread deployment still remain, such as the lack of NFC handsets, the lack of standards and interoperability, and the security concerns of consumers. This has hindered the quick take up and widespread adoption of mobile payments in Europe. The payments industry must face the existing obstacles before consumers and merchants widely adopt mobile payments.

Keywords
remote mobile payments, proximity mobile payments, business model

Carlo R. W. de Meijer is Senior Researcher for Market Infrastructures at Royal Bank of Scotland. He has a master’s degree in international economics from the University of Tilburg (1977). During his career, Carlo has held various positions, both as senior economist and as a private investment adviser. He has published many articles on various economic and financial topics, especially related to international financial markets and to European financial and monetary integration.

Jonathan Bye is Senior Consultant, Market Infrastructures at Royal Bank of Scotland. Jonathan is responsible for managing settlement risk policy in UK bulk clearings (Bacs, Cheque and Credit) and Faster Payments as well as the development of mobile payments standards. He represents RBSG at the Payments Council Settlement Risk User Group and the Faster Payments Settlement Risk Committee. Jonathan is also a member of the EPC M-Channel Working Group and chaired the Mobey Forum’s Remote Payments Task Force responsible for the publication of several white papers and implementation guidelines on mobile payments. He has a degree from the University of Manchester Institute of Science and Technology in Textile Economics and Management and an MBA from Cranfield. Prior to moving into banking, he worked in the pharmaceutical industry and as a retail research analyst.

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