US mobile payments will reach $90 billion by 2017, a 48% compound annual growth rate (CAGR) from the $12.8 billion spent in 2012. This is according to Forrester’s latest five-year mobile payments forecast, which segments mobile payments into three categories: 1) in-store mobile payments (proximity payments); 2) mobile commerce (m-commerce); and 3) mobile peer-to-peer (P2P) and remittances.
While all three categories will see healthy growth over the next five years, in-store mobile payments will far outpace the growth of m-commerce (representing 90% of the total mobile payments market in 2012). By the end of 2017, Forrester forecasts m-commerce to drop from 90% to 50% share, while in-store payments will jump from 4% to 45% share. “Lower barriers to adoption, increased convenience, and early entrants striving for scale will be important drivers of this growth,” notes Analyst Denée Carrington in a new blog post detailing findings from the forecast.
In a second forecast, Forrester drills down into the growth of retail m-commerce over the next five years, noting: “While we expect the m-commerce penetration rate to double by 2017, m-commerce in the US is still a tiny portion of e-commerce and, consequently, a minuscule share of overall retail.” In fact, notes Analyst Sucharita Mulpuru in a new blog post, only 3% of all m-commerce transactions (including daily deals, excluding travel) were completed on mobile devices in 2012, and this number will only reach 9% in 2017.