With so many banks and merchants trying to get consumers to pay with some form of mobile app or wallet, awareness is increasing.  But so is confusion — there are so many options, and no clear winner.  This impressive infographic from SapientNitro does a great job of explaining today’s payment landscape.  They classify mobile payments into three categories:

• mCommerce (online browser-based purchases using payment information stored with the retailer – i.e. Amazon’s 1-click ordering)
• mPayments (retail purchases using payment info stored in an app on your smartphone – i.e. the Starbucks app)
• mWallets (retail purchases using payment info stored in a “wallet” on your smartphone that contains all your cards and other payment choices – plus shipping info and receipts)

Not all mPayment and mWallet transactions occur the same way.  Although some transaction authorizations are occurring via SMS and similar technologies, the fight for dominance has two major camps.  One camp supports “contactless” payments enabled by NFC (near field communications).  This type of transaction occurs when a consumer opens an app or ewallet and waves her smartphone near a receiver.  (Check out Mashable’s simple overview of NFC for more.)  The major players in this camp are: Google Wallet, VISA V.me, MasterCard PayPass, and most of the mobile phone carriers (except Sprint) confederated as “ISIS”.  NFC works, but so far few smartphones are NFC-equipped, and most major retailers have been unwilling to invest in the NFC POS infrastructure.

The second major mobile camp is centered around migrating mCommerce from online to offline.  PayPal is the most commonly-encountered example, although Google Checkout and Amazon Payments are working hard to gain traction.  PayPal acts as an intermediary, storing your card or bank account information so that you can use it anytime.  Online, all you need do is enter your password.  Offline, all you do is punch your phone number and password into the keypad at the register.  It’s easy and has the added advantage of feeling more “hack-proof” to consumers than smartphone-based payments.  Apparently many retailers are seeing these advantages and signing up for the service.

But don’t forget about Square, which also acts as an intermediary for mobile credit card transactions.  It’s an easy way to make person-to-person payments, as was the case with my recent cab trip in San Francisco.  The driver didn’t have much English, but when I indicated that I wanted to pay via credit card, he popped the Square reader into his smartphone’s audio port, swiped my card, entered the total, then handed it to me so that I could sign the screen and enter my email address.  The receipt showed up in my inbox within moments.

Which one will capture the hearts and funds of Americans?  Right now PayPal is looking strong.  It’s easy, and you don’t have to worry about losing your phone or having the battery die.   But there are many big brands working on solutions – and never underestimate whatever Apple may surprise us with.  One thing is sure: the winning payment solution will have to be simple and easy.  We wouldn’t have it any other way.