Mobile payments gain traction worldwide

The electronic payments industry is going mobile - and fast.

Companies are increasingly allowing customers to pay for their services on smartphones and tablets. In fact, at one San Francisco establishment, mobile is the only way you can pay.

According to Mobile Payments Today, David Silverglide's gourmet sandwich shop Split Bread doesn't accept cash, only credit and other ACH cards or payment by mobile device via QR codes that appear on every table in the restaurant. Silverglide's choice to adopt the system was based on the streamlined process it creates for customers, who can order on a digital menu directly from their tables, as well as the increased efficiency it affords his business model.

"It's very time-consuming," Silverglide said of handling cash, according to the news source. "They have to count it in the morning, check out drawers, make bank deposits. Corporate staff have to match and reconcile. Inevitably, there is some loss, whether it's a counting error or misplaced bills. It slows everything down."

Italy to adopt mobile payments systems
The mobile payments movement isn't limited to trendy cities in the United States, however.

Reuters recently reported that Milan-based mobile payments technology SIA planned to establish a large-scale platform in its home country that enables businesses to accept payments via smartphone. With countries like Poland already adopting similar solutions, SIA intends to expand the system well beyond Italy.

"Mobile payments will be launched in Italy at the beginning of 2014, before the end of March, and we are trying to replicate this in other European countries," the firm said, according to the source.

The company has a good reason for releasing such a platform, as Italians appear highly receptive to the idea of mobile payments. A study by ISPO revealed that 94 percent of Italians were in favor of paying with their devices and liked that it would afford them the convenience of not having to deal with cash and bank cards as often, Reuters wrote.

Australian schools to allow mobile payments for student lunch
The growth of the trend has governments getting creative, too. Eight Australian schools are test-launching a mobile lunch payments program in which parents can pay for their children's school meals using their smartphones, the Herald Sun reported.

The government hopes to put the program in place in schools nationwide, assuming the trial launch is successful. The news source noted that parents in the test school districts are enthusiastic about the program.

"We have had some parents saying it's the best thing we have ever done,' said Principal Ian Wren of Bacchus Marsh Primary School, one of the academies testing the initiative, according to the Herald Sun.

Mobile has ups and downs for businesses
As universal adoption of mobile payments begins to appear inevitable, companies might begin considering how they can avoid potential pitfalls of the platform and make it work to their benefit.

According to Bank Tech, the CEO of a prominent payment solutions provider recently pointed out that low-value mobile payments present a difficulty to many businesses.

"The processing cost per transaction usually comes to $0.14 or $0.15 on the issuer and acquirer side," the CEO remarked, according to the source. "For ... transactions under $10, those $0.15 needed by the [payments] providers to at least break even become a big part of the transaction."

Bank Tech noted that the key to solving this problem lies in businesses adopting different payment solutions for mobile. For instance, some services aggregate multiple low-cost payments into one transaction, thereby saving the company money.

In particular, companies looking to get ahead of the curve and adopt mobile payment systems in the near future might consider what combination of services will prove most helpful in smoothing the transition.