Android Pay launches in Australia (GOOG, GOOGL)

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Android Pay, Google’s proprietary mobile wallet, launched in Australia on Thursday.

That marks the wallet’s fourth country, following launches in the US, UK, and Singapore. Android Pay will be available to customers with Visa and Mastercards issued by 25 banks and credit unions, including ANZ and Macquarie, as well as American Express cardholders.

Android Pay has multiple major retail partners, including 7-Eleven, McDonald’s, and Domino’s, as well as several in-app partners. Australia is now the third country to have all three major phone-based mobile wallets go live, following the US and Singapore. 

Android Pay will face stiffer competition in Australia than other wallets.

• The wallet has a wide potential user base. 64% of smartphones sold in Australia between March and May of this year were Androids, compared to just 36% for iOS devices, according to TechCrunch. And Australian users are interested in phone-based mobile wallets — when ANZ launched support for Apple Pay in April, applications “skyrocketed,” according to the Sydney Morning Herald.
• But unlike Apple Pay, Android Pay has considerable competition. Many major Australian banks have their own HCE-based contactless wallets. Those wallets aren’t available to Apple users nor do they boast compatibility with magnetic stripe terminals, which gives Apple Pay and Samsung Pay an easy value proposition. Android Pay competes with these wallets much more directly, which means that in order to attract users from Australia’s major banks, it’s going to have to present compelling advantages in other ways.

Mobile payments are becoming more popular, but they still face some high barriers, such as consumers' continued loyalty to traditional payment methods and fragmented acceptance among merchants. But as loyalty programs are integrated and more consumers rely on their mobile wallets for other features like in-app payments, adoption and usage will surge over the next few years.

Evan Bakker, research analyst for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on mobile payments that forecasts the growth of in-store mobile payments in the U.S., analyzes the performance of major mobile wallets like Apple Pay, Android Pay, and Samsung Pay, and addresses the barriers holding mobile payments back as well as the benefits that will propel adoption.

Here are some key takeaways from the report:

• In our latest US in-store mobile payments forecast, we find that volume will reach $75 billion this year. We expect volume to pick up significantly by 2020, reaching $503 billion. This reflects a compound annual growth rate (CAGR) of 80% between 2015 and 2020.
• Consumer interest is the primary barrier to mobile payments adoption. Surveys indicate that the issue is less the mobile wallet itself and more that people remain loyal to traditional payment methods and show little enthusiasm for picking up new habits.
• Integrated loyalty programs and other add-on features will be key to mobile wallets taking off. Consumers are showing interest in wallets with integrated loyalty programs. Other potential add-ons, like in-app, in-browser, and P2P payments, will also start fueling adoption. This strategy has been proved successful in China with platforms like WeChat and Alipay.

In full, the report:

• Forecasts the growth of US in-store mobile payments volume and users through 2020.
• Measures mobile wallet user engagement by forecasting mobile payments' share of their annual retail spending.
• Reviews the performance of major mobile wallets like Apple Pay and Samsung Pay.
• Addresses the key barriers that are preventing mobile in-store payments from taking off.
• Identifies the growth drivers that will ultimately carve a path for mainstream adoption.

To get your copy of this invaluable guide, choose one of these options:

1. Subscribe to an ALL-ACCESS Membership with BI Intelligence and gain immediate access to this report AND over 100 other expertly researched deep-dive reports, subscriptions to all of our daily newsletters, and much more. >> START A MEMBERSHIP
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The choice is yours. But however you decide to acquire this report, you’ve given yourself a powerful advantage in your understanding of how mobile payments are rapidly evolving.