Mobile payments may overtake cards in five years
At least in the U.K., a third of consumers expect smartphone payments to outpace credit and debit cards by 2020, according to a survey from Experian.
Sixty-seven percent of respondents feel cash will decrease in popularity over the next fives years, while two in five (41 percent) think there will be a decline in the use of credit and debit cards. The "Banking Moving Forward" study was based on 2,004 online interviews of U.K. adults last August.
Unsurprisingly, the main reason smartphone payments are not currently the preferred method of payment is a fear of fraud. Almost half of respondents (46 percent) feared their identity might be stolen online while 60 percent had no malware protection on their smartphone devices.
When asked about how other forms of payment could fare, four in five (80 percent) said that secure online payment platforms, such as PayPal, that let people shop using their debit card, credit card or bank account without sharing their financial details, will become more popular by 2020.
Other expectations around payments by 2020:
- Fourteen percent believe that biometrics, such as retina or fingerprint scans, could become commonplace;
- Two in five (44 percent) would be prepared to make payments via biometric scanning;
- A fifth (19 percent) would consider paying for goods and services using voice authentication.
In its 14th edition of Technology, Media & Telecommunications (TMT) Predictions, Deloitte forecast that in-store smartphone purchases worldwide will increase by more than 1,000 percent this year versus 2014. Citing a "tipping point" situation, Deloitte said 2015 will mark the first year in which the multiple prerequisites for mainstream adoption — satisfying financial institutions, merchants, consumers and device vendors — have been sufficiently addressed. In 2015, about 10 percent of the base of smartphones worldwide will be used to make an in-store payment at least once a month, compared to less than half a percent (led by early adopters in Japan) of about 450 million smartphones in mid-2014, the report predicted.
A recent survey of more than 1,000 consumers by Placeable, the location-based marketing company, found, however, that although approximately 70 percent of respondents trust mobile payments, only nine percent have used mobile payments even when they are available. Consumers said they don’t see a reason to use them and Placeable suspects specialty promotions, discounts and loyalty programs will be required to convince shoppers to try mobile wallet.
- One in three UK adults expect smartphone payments to outpace credit and debit cards by 2020 – Experian
- In-store smartphone payments take off, but don’t take over and enterprises lead in adopting new technologies – Deloitte
- Technology, Media & Telecommunications Predictions 2015 – Deloitte
- Placeable Research Reveals Consumers Trust, But Don’t Use Mobile Payments – Placeable
Do you see 2015 as a breakout year for mobile payment adoption? What hurdles do you see? Will biometric scanning be a decisive ingredient in winning over consumers?