Critical Success Factors of Mobile Payments

Scientific Essay from the year 2002 in the subject Business economics - Banking, Stock Exchanges, Insurance, Accounting, grade: 1,0 (A), Technical University of Darmstadt (Finance and Banking Management (TUD); Institute of Information Mangement (HSG)), language: English, abstract: In the context of this research, payment is understood as the exchange of monetaryvalue between participants either directly or using an intermediary.5 Mobile payment(mPayment) can be understood as every payment where at least one participant appliesmobile phone technology, thus, uses a mobile phone.6 But due to technological progressit seems reasonable to classify other devices like a Personal Digital Assistant (PDA) ordevices with embedded Radio Frequency (RF) technology as mobile payment devices.7However, mobile phones today clearly outnumber every other mobile payment device. Penetration rates8 are forecasted to reach almost 80% in Europe by 2005.9 The numberof worldwide cellular subscribers is expected to pass one billion by 2003.10 By 2005there will be more mobile phones worldwide than TVs, fixed line phones, and PersonalComputers (PC).11Driven by the increasing penetration and resulting business opportunities, numerousmPayment solutions have been offered by payment service providers, telcos, and financial institutions. The variety of applicable technologies, the possible linkagebetween the financial instruments, and the mPayment device combined with differentpayment scenarios offer a wide landscape of mPayment solutions. Besides technology,questions dealing with consumer expectations, factors thriving or inhibiting awidespread adoption, and with it related penetration strategies for payment serviceproviders have to be carefully researched to develop a successful mPayment.125 See Dahlberg/Mallat (2002) p. 651. 6 See Krueger (2001) p. 1; see IWW (2002a) p. 5; see Kreyer/Pousttchi/Turowski (2002) p. 1 f. 7 See Thing/Rouse (2001); cp. chapter 3.2. 8 Users as a percentage of the population. 9 See Barnett/Hodges/Wilshire (2000) p. 164. 10 See Barnett/Hodges/Wilshire (2000) p. 164; see Krueger (2001) p. 3; see GSM Association (2002b). 11 See Datta/Pasa/Schnitker (2001) p. 72. 12 See Dahlberg/Mallat (2002) p. 650.