Soon our whole identity could be contained within our chosen device, driving activities across all channels

The stunning growth rate of the mobile payment market is proof that China is leading the rest of the world in this field.

Mobile payments in China accounted for an incredible 65 percent of online payments last year, up from 49 percent in 2014, and this is only likely to grow in the future.

Chinese technology arguably leads the field in payment tech - notably with Alipay and Tenpay, whose QR code-based model has proved very popular with consumers.

Western tech giants like Apple and Samsung are now following behind. Both Apple Pay and Samsung Pay have launched services in China that partner with the popular UnionPay program to deliver payment services via new-field communication rather than QR codes.

The rapid development of China's mobile payment market has partly been driven by a series of government initiatives. Initiatives such as the 13th Five-Year Plan (2016-20) and Internet Plus have helped the Chinese companies to put their offerings onto online and mobile platforms. They have also encouraged Chinese companies to build the strong technological foundations that will enable them to innovate, grow, and ultimately compete outside China.

Perhaps the most compelling reason mobile payment has developed so fast in China, however, is that the country's booming middle class finds it so convenient. A recent Why Do They Pay That Way study commissioned by Worldpay found that a small group of super-shoppers now account for 92 percent of monthly internet shopping revenue. Nowhere was their buying power higher than in China where, despite accounting for just 5 percent of the general population, super-shoppers were responsible for an incredible 87 percent of China's estimated online shopping revenue.

The popularity of online shopping and mobile payment in China has led to a third trend: widespread use of the e-wallet. According to recent research by Worldpay, Chinese consumers lead the world in e-wallet use, with 54 percent of the country's online shoppers using them to pay for goods and services.

As more consumers ditch their credit cards in favor of paying with their smartphones, or simply go straight to paying via e-wallets, it's fascinating to wonder if this is the beginning of the end of the traditional wallet. Many of us are already storing card information and travel documentation on our mobile device, so the digitization of our identity data is simply the next logical step in moving our wallets into the digital sphere.

Nevertheless, there continue to be a number of obstacles to the adoption of e-wallet technology. Chief among these is the problem of battery life. While mobile innovations are being introduced into smartphone software and hardware at an unprecedented speed, battery performance is failing to keep up, preventing users from being able to fully rely on their smartphones for uninterrupted access to payment and identity services.

Additionally, with identity fraud still a No 1 consumer concern, cautious shoppers continue to be wary of mobile payments. Mobile payment may be able to provide additional security features that offer greater safety than a PIN or password, such as biometric authentication, yet these benefits are not yet mainstream. But the pressure to make smartphones more secure will increase as consumers begin to store more sensitive documents in our digital wallets.

The real test of e-wallet security will come as and when consumers begin to add identity documents such as passports or ID cards to their smartphone. Arguably, the technology to protect them - from biometric authentication and encryption to two-factor authentication - is already there. The further adoption of e-wallets will come when consumers realize that, compared with a physical wallet, the smartphone is a safer and more reliable space.

There are already strong signs that e-wallets are becoming mainstream payment methods outside of China. Last year, our research predicted that digital wallets will overtake credit cards in the global e-commerce market by 2019.

The benefits are undeniable for consumers who value convenience above all things, as they give them the ability to store their entire wallet within their mobile device. And as shoppers become increasingly comfortable paying for goods with their smartphones, the transition from using a phone as a digital payment to a proof of digital identity is the next logical step.

For modern consumers, the mobile phone represents far more than a communications device and a way to shop and pay for goods and services. Increasingly, the smartphone acts as a fulcrum between technology and human identity, and the convergence of man and machine within the phone will drive activities across all channels.

By giving our real identity, in the form of sensitive payment information, a place on our phones, the e-wallet has arguably given birth to a new mobile identity that is both more complex and more secure than any one document like a passport can ever be. This concept of mobile identity sees your phone number, device, payment information and unique behavioural patterns converge in one place - the phone.

Is the end of the traditional wallet coming soon? Yes.

Is it going to change the way we shop, pay, even think about ourselves? Absolutely.

The author is country manager at Worldpay China. The views do not necessarily reflect those of China Daily.

(China Daily European Weekly 10/07/2016 page9)