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Why aren’t consumers itching to use mobile payments? According to research from Walker Sands Communications, security and privacy are the main reasons.
While fragmentation across mobile payments systems and slow implementation on the part of retailers are likely not helping the situation, a majority of US adult internet users surveyed said they were hesitating about mobile payments because of security—not because they couldn’t use their favorite app on their favorite phone to pay at their favorite retailer. And just under half indicated that privacy worries were also holding them back. These concerns were about twice as widespread as issues around convenience and retailer preparedness.
Then again, consumers don’t necessarily default to the payment method they consider most secure. A majority of respondents told Walker Sands they felt cash was the safest payment method, but retailers can be assured that a significant portion of those shoppers are still carrying—and using—plastic.
In fact, cash was the preferred payment method for most respondents only in limited circumstances. Credit cards, which were rated the No. 2 most secure payment method, were also significantly less likely to be the preferred payment method compared with debit cards, which were considered less secure.
So is security really the issue? Walker Sands also found that 60% of internet users weren’t using any mobile payment apps currently, and those who were reported fragmented usage across a host of options. Just 4%, for example, were using Apple Pay. With the Apple Watch hitting shelves soon, that’s a figure with upward potential. If providers and retailers can educate consumers enough to get them past the mental security hurdle, smart watches could draw many shoppers to wave a wrist in front of a point-of-sale terminal for payment. But will retailers be as ready as about three-quarters of internet users think they are to accept these new types of payments?
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