New services to make spending money easier are springing up all the time. They are not confined to the rich world: in Kenya roughly 60% of adults—about the same number as have a bank account—use a mobile-phone payment service called M-PESA (see chart 4) And increasingly they cater to business customers too: services that integrate electronic invoicing and payments into a firm’s procurement and accounting system, or that help manage and raise working capital, are becoming commonplace.
Not surprisingly, the titans of the internet have started to eye up the payments business. Google offers a virtual wallet; Amazon recently set up a service to allow its customers to transfer money; Facebook and Apple have expressed interest in the field. There is much speculation that the latest iPhone’s ability to read fingerprints may be heralding a world-changing payment service. Telecoms companies (such as Safaricom, the firm behind M-PESA) and bricks-and-mortar merchants (Starbucks) are also dabbling in the field.
In China McKinsey expects it to increase by 42% a year between 2012 and 2017. Brazil is already the world’s second-biggest market for card transactions after the United States, according to Capgemini, another consultancy.
Consultants like to speak of “purchasing journeys” in which settling the bill is only the final step. Other waystations include advertising, internet search, participation in loyalty schemes and so on. Innovators, the thinking goes, could afford to undercut market prices for payments in anticipation of greater rewards at some other stage in the journey.
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