Mercator Advisory Group agrees the most commonly provided answer from individuals when asked why they are reticent to utilize a mobile wallet has consistently revolve around concerns of security. Despite assurances to the contrary, the response persists. The argument to their safety typically resembles the variant bellow.
Mobile wallets are in many ways safer and more secure than our good old cash and plastic money. This is in part due to the way financial information is transmitted between the bank and the application, via a token in place of the customer’s account number. The token is actually an encryption that allows for only the application provider to understand the unique details of each transaction and carry out the transaction instructions. Then why are customers still reluctant to take up mobile payments in a big way?
Why indeed. Questioning the security of the mobile wallet is a rational response, but as we are dealing with human behavior, it bears consideration that most individuals have not been incented to adopt the use of mobile wallets. Reshaping a behavior takes effort, and few of us will take on the arduous task of reshaping a habit without some sort of reward to do so.
Mobile wallet proponents and stakeholders appear to be waiting for conditions to be more favorable to make the push. Until then, it appears that mobile wallet adoption will continue its slow burn.
Overview by Joseph Walent, Senior Analyst, Emerging Technologies Advisory Service at Mercator Advisory Group
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