Merchant Mobile Wallets: Mobile Payments in Action


Cracking the code to motivate U.S. consumers to adopt mobile wallets

Mercator Advisory Group research describes opportunity for merchant payment services providers in the mobile payments market

Author: Joseph Walent
Published on: April 12, 2016

Merchants are showing the way to capture the U.S. consumers’ attention in use of mobile wallets, and the financial institutions facilitating the effort will be able to demonstrate continued value to their merchant clients according to Mercator Advisory Group’s latest research report, Merchant Mobile Wallets: Mobile Payments in Action. Adoption of universal mobile payment methodologies such as Apple Pay and Samsung Pay continues to lag in the United States compared to developed economies in Europe and Asia. Technology companies involved in the production and distribution of mobile devices (Apple, Samsung) have assumed the mantle of lead advocate, while many major banks and mobility network providers assist in a support role.

Modifying existing electronic payment methods to be mobile and reside on the near ubiquitous smartphone device, now estimated to be used by between 80% and 85% of U.S. mobile subscribers, has been an important effort in retail payments for some time. The migration of noncash payment to the mobile device will eventually be widespread, but at present it proceeds at a pace reflective of technology device upgrade. However, several players in the merchant sector have recognized and exploited opportunity to reshape payment processes and methods to their own benefit and as a marketing tool. This shift represents an opportunity for merchants and financial institutions alike, according to this research by Mercator.

This Mercator Advisory Group research report defines single-merchant and merchant-aggregator mobile wallets, profiles examples of each, and explains how these two wallet categories differ from universal mobile wallets. Coverage includes the strengths and weaknesses of the two merchant wallet styles and the characteristics of merchants that would most benefit from each style.

“The technology that is prerequisite for the use of Apple Pay, Android Pay, and Samsung Pay is not held by a majority of Americans on their current smartphone devices. This creates an opportunity for merchants and their partners to create and refine business–specific payment solutions that generate richer customer engagement interactions and consumer rewards. Merchants and their partners have a chance to demonstrate added value and provide incentives for customers to adopt merchant mobile payment apps that leverage mobile technology already in their hands,” commentedJoe Walent, Senior Analyst, Emerging Technology Advisory Serviceand author of the report.

This research report contains 21 pages and 3 exhibits.

Companies mentioned in this report include:
Cumberland Farms, Dunkin Donuts, LevelUp, Starbucks, Target, Walmart, and Zipline.

Highlights of the research note include:


  • The objective of the merchant mobile wallet 
  • How the two types of merchant mobile wallets—single-merchant and merchant-aggregator—function, with profiles of examples of each type 
  • Merits of merchant mobile wallets versus merits of universal wallets 
  • Near-term opportunities for merchant mobile wallets 
  • Estimates of merchant mobile wallet spend in the United States



Go to Top