Mobile payment

What is a mobile payment?

A mobile payment is a payment made or accepted using a mobile device, such as a smartphone, tablet, or smartwatch. Mobile payments can be used for online purchases, in-store contactless payments via NFC, QR code payments, peer-to-peer transfers, mobile banking transactions, and carrier billing.

Mobile payments are often grouped under alternative payment methods, although some mobile wallets still use card networks, bank transfers, or other existing payment rails in the background.

Why are mobile payments popular?

Mobile payments are popular because they make payments faster, more convenient, and easier to complete across online and in-store channels.

For customers, mobile payments reduce the need to carry cash or a physical card. A customer can pay with a smartphone, smartwatch, mobile wallet, QR code, mobile banking app, or carrier billing flow, depending on the payment method and market.

For merchants, mobile payments can improve the checkout experience and drive higher conversion rates, especially in mobile commerce. They also help businesses serve customers in markets where wallets, QR payments, or mobile banking are preferred over traditional card payments.

Advantages of mobile payments

Key benefits include:

• Convenience — customers can pay with a device they already use every day.
• Speed — mobile payments often require fewer steps than manual card entry or cash payments.
• Security — many mobile payment systems use tokenisation, biometric authentication, device-level security, or transaction confirmation.
• Market coverage — mobile-first payment methods help merchants reach customers in regions where local wallets or mobile banking apps dominate.
• Omnichannel use — mobile payments can work across e-commerce, in-app payments, physical stores, subscriptions, and peer-to-peer transfers.

Limitations of mobile payments

Like everything in this life, mobile payments have their flaws. Though some might say the benefits greatly outweigh the shortcomings, it’s worth knowing that they exist.

• Lack of acceptance. Though mobile payments continue to gain traction, not every retailer supports them yet. It is especially noticeable in countries where cash dominates the payment landscape, such as Romania, Bulgaria, Egypt, Kazakhstan, and others.
• Not every phone supports them. You can use SMS to make payments with any mobile phone, but for contactless payments and mobile wallets, you need a smartphone supporting these technologies.
• Dependance on the device. If your battery dies or some malfunction occurs, you won’t be able to make a payment. Besides, your phone or tablet may get stolen. That’s why it is vital to have all available authentication and security measures enabled on your mobile payment devices.

How do mobile payments work?

Mobile payments can work in different ways depending on the technology, device, and payment rail behind the transaction.

• Mobile wallets store payment credentials or tokens in an app, allowing customers to pay online, in-app, or in-store. Examples include Apple Pay, Google Pay, PayPal, and other local wallet solutions.
• NFC contactless payments use near-field communication to exchange encrypted payment data between a mobile device and a payment terminal. This is common for in-store tap-to-pay transactions.
• QR code payments allow customers to scan a merchant’s QR code or present their own QR code to complete a payment. This model is widely used in mobile-first markets and local wallet ecosystems.
• SMS payments and carrier billing allow customers to pay through their mobile phone number, with the amount charged to their mobile balance or phone bill. These methods are often used for digital goods, transport, donations, or markets with lower card penetration. Besides, SMS payments are a financial inclusion remedy for economies with a large unbanked population. For example, in Kenya, the most popular payment method is M-PESA, powered by a network of agents and text messages.
• Mobile banking payments let customers pay bills, transfer money, top up accounts, or complete purchases directly through a bank's mobile app.
• Mobile web and in-app payments happen when customers complete checkout on a mobile website or inside an app. The payment may still be processed through cards, wallets, bank transfers, or other payment methods.

Examples of mobile payment methods

There are hundreds of mobile payment systems worldwide, each with pros and cons. Which is best is up to you, but to help you choose, we’ve compiled a list of the ten most popular and loved ones.

• Google Pay — a solution enabling frictionless online and contactless payments on Android devices, though it also works on iOS and the web. It has over 220 million users worldwide and processes 15 billion transactions annually. Corefy offers direct, ready-made integration with this in-demand solution. Learn how to benefit from it!
• Alipay — the world’s largest mobile payments platform, though China is its top market. It is a QR code payment solution with around 640 million monthly active users.
• Apple Pay — a payment service for iOS that accounts for a 43.9% share of the US mobile payment market. It works similarly to Google Pay but comes hand in hand with Apple Card and Apple Cash services.
• PayPal — everyone interested in payments has heard this pioneer’s name at least once. It is a ubiquitous payment platform with 426 million users and a vast geography.
• Samsung Pay — though it is far behind Apple and Google Pay in terms of popularity — is the only service that supports both NFC and MST, allowing its users to make payments at any POS terminal. Unfortunately, its coverage is limited to a few markets, and it doesn’t support money transfers.
• WeChat Pay — the default payment method of China’s viral super app WeChat. It had 900 million active users in 2021.
• Cash App — the only app on the list that allows users to buy and sell Bitcoin. It is also a user-friendly, multifunctional payment app available in the US and the UK.
• Zelle — American solution launched by the Bank of America, Truist, Capital One, JPMorgan Chase, PNC Bank, US Bank, and Wells Fargo. It connects to users’ bank accounts and enables easy electronic transfers to and from them.
• Venmo — PayPal’s subsidiary that uses peer-to-peer technology to send money online. It is a go-to option in the USA, supported by more than 2 million merchants.
• Paytm — one of India’s most popular payment platforms offers mobile payment services and allows merchants to receive QR, POS, and online payments. Over 7 million Indian merchants use its QR code solution.

Why mobile payments matter for merchants

Mobile payments are important because many customers now discover, compare, and buy products on mobile devices. If the checkout flow is slow, difficult to complete, or missing a familiar mobile payment option, customers may abandon the purchase.

For merchants, supporting mobile payments can improve checkout convenience, reduce manual card entry, and help localise payment experiences for different markets. The right setup depends on customer geography, device usage, local payment habits, transaction type, and provider coverage.

Corefy helps businesses connect and manage mobile payment methods across different providers and markets. Through one payment infrastructure layer, merchants and payment businesses can support wallets, local payment methods, mobile-friendly checkout flows, routing, reporting, and reconciliation across multiple payment providers.

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