Mobile POS: The next frontier for the mobile transaction services ecosystem


Mobile POS is hot – perhaps hotter than ever – and competition in the mobile and tablet-based card processing space is heating up across Europe, the US and even Asia.

In order to answer the obvious question of “where is mPOS headed?” it is perhaps best to first have a look at how the market stands mid-way through 2013. Put simply, the mPOS space is thriving. New developments and partnerships are being announced with growing frequency, some big industry names (such as Groupon) are branching out into mPOS and tech-savvy start-ups continue to roll out mobile card-based processing programs across multiple geographies. Meanwhile, established mPOS market players – think Square and PayPal – have been taking the fight for market capitalization to the next level by enriching their offerings and adding multiple perks all aimed at maximizing customer on-boarding.

Industry predictions on the impact and profitability of the mPOS market are also piling up. At the end of April 2013, a study by research firm Javelin Strategy & Research found that mobile POS acceptance is attracting small merchants to big-box retailers, posing a growing threat to traditional terminal-based solutions and vendors.

The growing popularity of mPOS solutions takes place against the backdrop of evolving – and changing – consumer needs in developed market environments and the rise of “connected living” retail ecosystems in which consumers have grown to expect a seamless retail experience irrespective of the channel they use (mobile phone, online or in-store). In turn, this has prompted merchants to look for solutions which allow them to construct omni-channel sales environments in which there are systems and integrated back-office functionalities which allow them to capture, centralize and overview customer data irrespective of how payment is initiated. In this context as well, mPOS has the potential to fit right in, given that it provides a new channel for merchants to connect with their customers and allow them to check out and pay directly on the sales floor.

The large number of mPOS solutions currently available present would-be customers with the challenge of finding the best way to navigate this space. Of course, not all companies active in this space and which offer mPOS solutions actually focus on the same target market and end users. The bigger question here is that of profitability – can it be achieved in this highly competitive, emerging mPOS ecosystem? Do smaller companies stand a chance to make money off mPOS when facing up to much bigger rivals which drift into the mPOS space from either payments processing or online commerce? Only time will tell.

Source: The PayPers