Definition: mobile payment service

Paying for merchandise or services in a store via mobile phone. A smartphone wallet app either holds prepaid funds or works like a credit card, and various authentication methods may be employed. As of 2020, Apple Pay, Google Pay, Samsung Pay and Venmo are some of the major payments services in the U.S. In China, WeChat and Alipay are the major platforms. See Apple Pay, Google Pay, Samsung Pay, Venmo, WeChat and Alipay.

The "Next Big Thing"
When the Internet exploded in the 1990s, a variety of Web-based payments systems were developed; however, except for PayPal, most were abandoned. The distinct advantage of smartphones is that people have them while shopping, and built-in fingerprint readers add a significant level of security.

The primary technology used in mobile payments is near field communication (NFC), which allows a person to pass the phone over a terminal to quickly pay for merchandise. Many Android phones included NFC, and Apple finally added it with the iPhone 6. Barcodes and QR codes are also used, which are displayed on the phone and scanned by the merchant's terminal. See NFC and barcode.

Like any "next big thing," mobile payments had to overcome the chicken-egg conundrum. The more retailers adopt a system, the more people use it, and the more people use it, the more merchants come on board. To fully embrace mobile payments, retail outlets have to support two or more systems. See mobile check deposit, Web payment service, digital wallet and smartphone wallet.

The Three Majors in the U.S.

Apple Pay, Google Pay (G Pay) and Samsung Pay are the major players in the mobile payment field in the U.S.