We’ve heard it all before, we’ll be scanning our phones at the checkout, using them as ID, and opening our houses with them. Not all our wildest predictions about mobile phones have come to fruition, but the rapid rise of smartphones has finally made them a genuine tool for financial transactions. In fact, a new Nielsen study commissioned by Paypal says we’re using them to make payments at a rapidly increasing pace.

The study reported massive growth in mobile payments through Paypal, with a 14 fold increase year on year transactions. Further, 68% of consumers plan to make mobile payments in the near future, and 65% of all mobile devices on the market are now able to access the internet. Paypal also reported an increase from 1% of transactions being carried out on mobile devices in 2009 to 10% in the last quarter of 2010.

“With the arrival of mCommerce we expect to see more change in the retail industry in the next three years than we have seen in the last decade,” says PayPal Australia’s managing director Frerk-Malte Feller. “In the last quarter, our merchants have enjoyed a 25 per cent month on month increase in total mobile payment volumes. Retailers must embrace mCommerce now or risk being left behind. Australian retailers were late to the eCommerce market and cannot afford to make the same mistake again.”

Other discoveries from the report

• The most popular time for mobile shopping is when consumers are traveling
• 76 per cent of consumers cite convenience as the main reason for transacting on the go, and
• Internet enabled phones may be in the hands of everyone by 2013

“It is time for Australian retailers to form strategies addressing multiple channels,” says Jennifer Cromarty, Australian Retailers Association's deputy executive director. “The retail industry is evolving and retailers must move with it to both remain competitive and meet shifting consumer demands. Put simply, retailers must have a presence wherever their customers are – be they in store, online or on their mobile phones.”