If I had a nickel for every time I heard thata person will leave their wallet at home before they leave theirphone, then I might have enough to fix the damage done fromgrinding my teeth every time I heard this false trope.
Heading to work this morning, I realized about a block from homethat I had left my phone at home. No matter, I kept going, but ifit had been my wallet I would have turned around to get it. Whilemobile payments are making inroads in all areas of our lives,payments companies should not assume that the mobile phone can orwill replace the wallet totally.
While technologists and mobile solutions providers would say that Iam only one case and probably a reactionary luddite show should notbe trusted (or maybe that is just my co-workers), I can confidentlyassert that given the choice, most people over the age of 21 whoare heading out on a Friday, if given the choice would leave theirphones before their wallets. The reason is identification.
As of this time, the phone provides no legally accepted way toverify someone’s identification. That means everyone heading outfor the evening will want to make sure they have whatever containstheir driver’s license or government ID first and foremost. Mobileidentification credentials represent one of the highest hurdlesremaining for the mobile phone replacing the traditional wallet.The first company to solve this problem in a secure and reliableway will become the leader in the mobile wallet space.
Wait, there is a question in the back.
What about the teetotalers who can use their phones to pay forthings like transit, use applications like LevelUp or SquareWalletto pay inside of stores and restaurants, and even find their way tothose places with their phones? Surely they would leave theirwallets first with no compelling need for ID?
In response, pull up a barstool and let me tell another quickstory. I was at a conference recently with a group of paymentsprofessionals all talking about how they were going to airportlater in the day. “Well, I have my boarding pass on my phone, but Iprinted it out anyway just in case my battery dies or the readerdoesn’t work.”
Technical hurdles still exist that impede the universal adoptionof mobile wallets beyond the problems of identification. Brokenreaders, dead batteries, and power outages all conspire to keepcash and cards relevant. What is likely to become a niche for someproviders is offering some kind of backup system that will allow amerchant or customer a way to make a payment via some other means -a code entered at a point of sale, for example.
Of course, the most efficient solution may already exist. Severalcompanies offer cellphone cases that double as traditional wallets.As a friend of mine put – “Now I only have one thing to keep trackof.”