Imagine yourself in the role of a time traveler from the early ’90s. Everyone around you is carrying palm-sized devices with twice the computing power of the best technology had to offer. They communicate with e-mail, text, and voice from sidewalks and cars. Mobile devices have changed everything about the day-to-day life of the people around you. Only one technology has remained relatively unchanged: the ubiquitous credit card.
Despite the fact that the technology to store credit card information in a mobile device has been around for years, mobile payments have still not supplanted credit card transactions as the most common way to pay for goods and services. Despite the fact that 90% of adults have or have access to a mobile phone, 58% of them would never use a mobile device to pay a merchant, according to a recent survey by the Federal Reserve.
Why has mobile payment technology been so slow out of the gate? Here are 3 reasons why mobile payments difficulties are stymieing the growth of this exciting technology.
1) Security concerns
This is less of a technology problem and more of a consumer education problem. Consumers perceive mobile technology as being less secure, despite the fact that the same security protocols exist to protect information on mobile devices as exist on credit cards. The risk of having a phone stolen isn’t significantly greater than the risk of having a card stolen.
2) Lack of standardized hardware
Of the contenders in mobile payment, Apple Pay has been the most successful. That success has a lot to do with the hardware homogeneity in Apple products; there is only one version of each generation of iPhone. On an open OS like Android, the number of hardware configurations in each generation of smartphones keeps growing as new manufacturers become involved.
That problem expands exponentially on the merchant side. Merchants must have hardware to accept payment from Apple Pay, Google Wallet, and a dozen other card-specific apps, each of which may have unique hardware configurations. Point of sale equipment just can’t keep up with the proliferation of payment possibilities.
3) Lack of consumer motivation
Put simply, consumers don’t see the need to re-learn how to buy things in order to do so with their phone. The act of pulling out a credit card or using cash just isn’t that cumbersome, particularly given the “failure fatigue” that may linger after generations of mobile payment technology not living up to the hype. Consumers don’t see benefits and, in many cases, may lose out on rewards offered by cards.
Again, this is a struggle of consumer education. There are many benefits to mobile payments,including limiting the spread of dangerous diseases. Yet, until consumers realize these benefits, mobile payment technology is stuck in neutral.
For more information about mobile payment difficulties and how your company can overcome them,click here!
The post Are mobile payments difficulties holding back the new digital economy? appeared first on STRATECTA.