PayPal has commissioned a five-year forecast projecting the growth of mobile retail in the UK. The report anticipates an explosion in mobile retail, predicting that the market will grow an average of 42 per cent each year and be worth £2.5 billion by 2016.

Findings show that UK mobile retail sales currently represent 1.5 per cent of overall online retail sales, or £438 million. By 2016, UK mobile retail sales will hit £2.5 billion as just over 14 million adults regularly shop via their mobiles.

Each mobile shopper currently spends an average £100 per year in 2011 – by 2016 this will jump to £180 per year. PayPal says the market will grow at a compound average of 42.5 per cent per year, fuelled by increasing numbers of mobile shoppers, a rise in smartphone use and increasing numbers of retailers developing easy to use mobile shopping experiences.

Cameron McLean, general manager, merchant services, PayPal UK, says: “Mobile shopping is a growth market for UK retailers. The convenience of a connected device that can be used almost anywhere will lure increasing numbers of UK consumers into mobile buying. Our report shows that this consumer pull will be matched by a retailer push, with mobile-savvy retailers offering slick, sophisticated mobile experiences that rapidly become a key part of an overall multi-channel strategy.

“PayPal was created to let people make mobile payments. Over a decade later, mobile has come of age, and we expect to handle over $3.5 billion in mobile payments globally in 2011. The act of paying for something should be as seamless as the decision to buy it, and that’s where we can help retailers grow their mobile business. Over a million PayPal UK customers have sent a payment on their mobile.”

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