SAN FRANCISCO—The number of mobile P2P users will grow rapidly, from 69 million in 2015 to 126 million by 2020, a new study suggests.
According to Javelin’s report, Mobile P2P Payments in 2015: The Growth and Adoption of Mobile Money Transfers, by 2019 it is expected that more than half of all mobile device owners will be using mobile P2P.
Javelin also explained that to the “chagrin” of many financial institutions, sending money person-to-person has gone from expensive to cheap or free, forcing many in the industry to rethink this revenue stream.
Javelin said the influx of new mobile P2P users is attracting new non-bank competitors, who are focusing on facilitating commerce on their mobile and online platforms. These non-bank competitors include companies such as Facebook and Snapchat, who are seeking to enhance the functionality of their social media apps to include everyday occurrences such as P2P money transfers.
“Traditional payment organizations and financial institutions now compete with nimble newcomers and need to maintain design, experience, speed, and security in order to stay competitive. The payment industry is now face-to-face with an extremely active and social customer base. Many existing and potential P2P vendors are contemplating what new features or services will resonate best with P2P users,” said Michael Moeser, director of payments, retail and small business at JAVELIN.
The study surveyed more than 6,000 U.S. adults, and includes analysis of 13 P2P players, including: clearXchange, Dwolla, Facebook, Fiserv Popmoney, Google Wallet, MasterCard Send, MoneyGram, PayPal, Snapchat, Square Cash, Venmo, Visa Direct and Western Union.