It’s been years that we’ve been told how the mobile wallet is the future. Why then is there no one we know who actually uses their mobile phone as a wallet?
Back in 2009, Gartner Group predicted that the number of mobile payment users around the world would be topping 190-million by 2012. This year, Gartner revised that number to 212.2 million users, with a total of US$171 billion in mobile payment transactions. In the UK, services like Barclays’ PingIt, which allows you to transfer money to another user’s account using your mobile phone, have only just reached the market. Locally the same could be said for FNB while other banks are totally lagging. Businesses are hardly equipped properly to handle mobile payments. If there are so many users and so much money being transferred then why aren’t tech evangelists using the service?
One of the big problems, when it comes to defining mobile payments, is that this term encompasses a variety of different technologies. Nowadays, the technology that smartphones have on offer should allow us to use our online services like PayPal, Amazon Payments and Google Wallet to make real-world purchases. If you throw in mobile card readers like Square the area gets particularly murky.
So what are the hold-ups?
The first thing is that handsets just aren’t ready for this kind of technology. To take advantage of NFC, phones need to have a built-in chip that can identify the handset and that can manage the transaction. There are actually very few phones around with this sort of technology built-in; the Samsung Galaxy S3 is one and its pretty recent on the market.
Next on the list of obstacles is the fact that the mobile wallet just doesn’t have massive consumer confidence when it comes to security. In the US, a recent survey showed that after questioning 1 203 people it was pretty clear that most users would not feel secure using mobile payments to purchase goods in store.
Finally, the hurdle that will really determine how quickly the mobile wallet makes it to the marketplace is vendor confidence. Much of the technology that can make mobile payments really possible at any store is already available, but security issues and the fact that potential customers don’t seem enthralled by the idea, mean that vendors are a little nervous to invest in the technology required to make this all an everyday reality.
So, to sum up, while the mobile wallet has taken its time getting to us, the services are starting to appear. Realistically, it will be a good few years before you actually get to leave your real wallet at home and just rely on your phone… and if the polls are to be believed most of us aren’t going to be rushing to switch from leather to silicon just yet.