Mobile payment not yet meeting industry projections
Author: Maria Alejandra Lopez
Source: Retail Customer Experience
Mobile payment transactions are not yet meeting industry projections and a big reason is a lack of confidence by the consumer.
A Pew Charitable Trusts research study reveals younger Americans are driving mobile payment, motivated in part by reward and loyalty programs, but across generations consumers are still skeptical of the mobile transaction. Consumers have concerns about security and are more likely to trust traditional methods, such as using debit and credit cards when it comes to non-cash payments.
Another reason mobile payments are not catching fire, according to the study, may be because they are not yet offering a meaningful, faster or more seamless experience.
Here are key findings from the report:
Consumers avoid mobile payments because of concerns about loss of funds
Nearly 30% of respondents reported that they opted not to use mobile payments on at least some occasions for that reason. Nevertheless, 84% of respondents who had made a mobile payment in the past year also did so in the past month.
Consumers trust protections on debit and credit cards more than those on mobile payments
Respondents were more likely to say mobile payments are «poorly protected» (38%) than prepaid (28%), debit (22%), or credit cards (9%). This perception held even for mobile payments that involved a credit card and were therefore subject to the same financial safeguards as other transactions conducted with those cards: Just 35% of consumers said a mobile payment that uses a credit card was well-protected, compared with 61% for a credit card on its own.
Fifteen percent of consumers experienced an issue with a payment method (mobile or traditional) in the past year.
Problems included over-payment, disputes with a merchant, and fraudulent transactions. Nearly all these consumers knew what contacts to make to resolve their issue, were satisfied with the outcome and got their money back.
Consumers report that mobile payment issues are comparatively difficult to resolve.
Only 2% of mobile payment users experienced an issue with a mobile transaction in the past year. However, they were twice as likely as debit, credit or prepaid card users (39% vs 20%) to report that disputes were difficult to resolve and more than four times as likely (23% vs. 5%) to not know who they should contact.