Talking about new payment delivery channels canbe like an academic theory – sounds good, might not play outexactly as imagined. Take mobile payments and cab drivers forexample. I use cabs all over the country. In the past six months,here’s been my payment experience:
Cab #1: Accepts credit cards only if the rider has no cash. Once wegot over that, the driver took my card and using his pencil, spenta good ten minutes rubbing it over a manual imprint device (morethan once since that’s not easy to do) and finally offered me asales slip to sign. Not convenient.
Cab #2: A POS terminal was mounted on the back of the front seat ofthe cab. I was instructed not to use it since it didn’t really workmost of the time. I handed my credit card to the driver, who ranthe card through a device connected to his meter a few times (egad,how many swipes was that), and finally got a paper receipt to sign.Not convenient and especially irritating since the unused POSterminal was staring me in the face during the entiretransaction.
Cab #3: Accepts credit cards only if the rider has no cash (what,again!). Once we got over that, the driver took out a mobile POSand proceeded to walk around the cab trying to get a signal. Gotback in the cab, moved it up, walked around some more and finallygot a signal. I signed a paper receipt and went on my way. Notconvenient and frankly a little silly looking.
Cab #4: Yes, you guessed it – accepts credit cards only if therider has no cash (I didn’t mention merchant fees did I?). Got overit and the driver took his iPhone, inserted a card reader on thetop of it, swiped my card, input the tip, handed me his phone tosign with my finger and enter my e-mail address where five minuteslater a receipt showed up in my inbox. Who provided him with thissnazzy little gizmo? Intuit Small Business. Very convenient and alittle cool too.
One of the questions this begs is, if I had cash would I have usedit in some of these circumstances and the answer is yes, becauseconvenience is a trump card. At the same time, while my experiencewith the cab driver using his mobile phone was convenient it wasalso a bit scary. Do I want this person swiping my credit card onhis personal phone? Do I want to put my e-mail address in hispersonal phone?
I wasn’t entirely comfortable with it, but it was convenient enoughto make me suspend my disbelief in the less secure aspects of thetransaction. At a recent conference, I heard a presenter use theterm “tolerance of ambiguity” and that phrase is spot on. So whilemuch is written about the lack of security around mobiletransactions (which is certainly the case), if the device enables amore convenient payment transaction – consumers will push theirconcerns aside, pay their bill, and go on with their lives.