U.S. Mobile POS Installations Forecasted To Reach 17.4 Million by 2019

Installations of mobile point-of-sale devices in the United States and Canada will hit 17.4 million in four years, forecasts 451 Research in its “Mobile Point of Sale: Smart Devices Earn a Growing Share of Global Payment Acceptance” report released Thursday.

If it proves accurate, that forecast will yield a 155.9% increase from the current base of 6.8 million devices. On a compound annual growth basis, the market is expected to grow 21% over each of the next five years.

Globally, the forecast for growth is more pronounced, with expectations of 54.03 million mPOS devices by 2019, compared with 13.3 million now, a 306.2% increase.

451 Research defines mPOS as a smart phone, tablet, or other consumer-oriented mobile device that functions as a point-of-sale terminal and enables payment card transactions via a card reader.

A number of factors influence the forecast. “At a high level, one of the biggest drivers is increasing card penetration, and that’s primarily in emerging markets,” says Jordan McKee, the report author and senior analyst for 451 Research’s mobile payments coverage. As more cards are issued and placed in consumer hands, the more demand that creates for places to use them, he says. “Mobile POS has emerged as the bridge between the card base and the point of sale.”

Another factor is that merchants are finding new ways to use payments, often outside of how they traditionally might use them. One example is e-commerce giant Amazon.com Inc.’s Local Register, a mobile POS service it launched in 2014. Another is Shopify Inc., an e-commerce platform company, which began offering an mPOS product in 2014, too.

“You even see it in retail where merchants have leveraged mPOS to bridge the gap between the virtual and physical stores,” McKee says. He cites as an example grocer Harris Teeter, a Kroger Co. subsidiary, which offers online ordering that can be paid for on a Web site or upon pick up at the store via an mPOS device. “We’re starting to see retailers look more closely and integrate [mPOS devices] more holistically.”

Tablet POS devices, in particular, are finding favor among retailers, he says. Providers such as First Data Corp.’s Clover, ShopKeep.com Inc. and Powa POS from Powa Technologies Ltd. are making significant inroads with retailers. “We really see tablets as the next frontier for the point of sale in the small and mid-size space.”