The dynamic transformation in consumer lifestyles and the substantial surge in contactless payments have propelled Mobile Payments into the spotlight, offering a compelling value proposition for customers, merchants, and banks alike. According to Ovum's recent m-payments forecast, the global user base for mobile payments is projected to reach 4.77 billion by 2019, a substantial increase from the 690 million users in 2014.

While the overall landscape of mobile payments is set for growth, proximity-based payments emerge as the fastest-growing segment. Fig. A illustrates the growth trends of global mobile proximity payment users, indicating a significant upswing. The total transaction value of mobile proximity payments, encompassing both NFC and non-NFC transactions, is expected to soar from $4.77 billion in 2014 to a staggering $141.21 billion in 2019.

The rising popularity of proximity payments is not only attributed to their growth but also to the reduction in manual errors associated with traditional payment methods. Recent deployments have demonstrated a seamless transaction experience, eliminating the need to swipe a card or remember account details or PIN numbers. Payments can now be effortlessly conducted by waving a smartphone at a contactless-enabled Point of Sale (PoS) terminal, completing the process within mere seconds.

Mobile proximity apps come in two variants: card-based and account-based. While card-based deployments currently dominate the global landscape, account-based mobile proximity payments are gaining traction due to their lower transaction costs. In both scenarios, users securely upload their card or account data into a mobile payment app on their smartphones, enabling them to make purchases in brick-and-mortar retail stores. The encrypted card or account details within the phone can be utilized with one-time authorization tokens for each individual purchase, ensuring enhanced security and efficiency.