Consumer credit generated by mobile public transit payment will rise

The dominance of mobile phones in everyday life for young people today could suggest a future in which consumer credit data will be based primarily on payments and other financial actions taken electronically.

Mobile growth is extremely strong
Anne Bouverot, the director general of GSMA, an international group of mobile operators, believes the progress her organization has seen in the mobile industry has brought the use of mobile phones from devices used for convenience to instruments for social and individual progress.

"Mobile is a vibrant and evolving industry at the heart of everyday life for billions of people around the world," she said in a statement. "Mobile has gone beyond being a mere communications tool to one that provides life-enhancing ... services to men, women and children."

Payments, she notes, are one of the many private industry areas that mobile technology has made more accessible to the global community. One tech company, Mobill, has taken full advantage of that sector in its development of mobile payment systems directed towards public transportation, according to Mobile Entertainment. The source says the business, based in Sweden, has its hopes set on international use of the M-Ticket 2.0 platform it recently announced. Mobile Entertainment reports M-Ticket is being developed to accommodate diverse languages, currencies and mobile phone providers, which has helped Mobill partner with the far-away Sterna Security, a security solutions out of India.

It may not take long for mobile payment technologies like M-Ticket to reach the U.S., as a Zipcar study found the link between mobile phone use and public transportation is exceptionally strong among American millennials. The source claims that 25 percent of all young people interviewed have driven less in the years they have been able to use mobile transportation applications like maps with real-time subway or bus arrivals. A decreased need for personal vehicles, the study shows, has come to the United States with a rise in dependence on mobile technology.

Continuing the trend
Bouverot also noted that lawmakers will have to loosen laws on mobile payment regulations and related functions for the private sector to create more outlets for smartphone use.

"... To fully realize this future [of innovation] and to enable the mobile industry to maximize its investments, it is essential that we establish a light-touch regulatory environment, based predominantly on competition, and develop new business models that will allow all ecosystem participants to benefit from the mobile economy," she said.

This outlook is reflected by the actions of by firms such as Mobill as they work to make mobile payment for everyday travels a regular part of consumer life. The technology is somewhat of an alternative credit innovation, as Mobile Entertainment reports the company's new application will allow purchases of several fares at once for users. Although the source does not specify which international systems the organization is targeting as its first clients outside of Sweden, the company's CEO stated ​that the firm is working with 80 percent of public transportation providers in its native country today.

Zipcar CEO Scott Griffith is certain the results of his company's survey reveal a future of almost complete reliance on mobile technology for transportation purposes, where consumers will be able to use mobile applications to not only apply credit but to call public and private vehicles when they need them rather than wait as transit customers have been forced to in the past.

"We're living through the most important shift in transportation in generations - the creation of a new mobility society," he said. "Soon we'll live in major metropolitan areas that include networks of ubiquitous, mobile-app powered on-demand mobility services."

Evidence shows that in several years, numbers will be much higher than Zipcar's reported 65 percent of mobile phone and computer users who feel losing their electronic devices would have greater negative effects on their day than finding themselves suddenly without their cars.