Mobile Wallets Security a Major Incentive to Adoption, Study Finds
10-18-2017
There is a distinct knowledge gap for most Americans when it comes to mobile payments security, a recent study published by ETA member JPMorgan Chase has found.
Though encryption, tokenization and sophisticated authentication technologies make mobile payments one of the most secure methods of payment at the POS, the majority of Americans feel that “more and better security features than physical payments cards” would incent them to use mobile wallets over other payment methods, the study found.
According to the research, among non-users of mobile wallets, concern for data security was the number one reason given for not using mobile wallets; 37 percent said that they would be incented to adopt mobile wallets if they were more secure than physical payments cards.
Perhaps unsurprisingly, only 33 percent of non-users said they were informed to some extent about mobile wallets, whereas 16 percent said they completely confused about mobile wallets. The remain 51 percent, a slim majority, felt they fell somewhere in the middle.
But what is more surprising is that even among mobile wallet “power users” — consumers who use mobile wallets weekly or daily and score highly in awareness of mobile wallets features — 49 percent said that knowing mobile payments were more secure than physical payments cards would make them use them more frequently.
These results indicate the need for merchants to educate consumers on the security benefits of mobile payments in order to increase adoption, the report said.
Despite the knowledge gap, the study said to expect a “new wave” of mobile wallet users. Forty-one percent of consumers are likely to try digital wallets in the next year and 55 percent of merchants say they are likely to upgrade their POS systems to accept digital wallets in the next 12 months, the survey found.
The study was conducted by Forrester Consulting via an online survey panel of 1,500 U.S. consumers over the age of 18 and 800 merchants across a variety of industries, the report said. The study ran from May 2017 to June 2017. Read the full report here.
About ETA
The Electronic Transactions Association (ETA) is the world’s leading advocacy and trade association for the payments industry. Our members span the breadth of significant payments and fintech companies, from the largest incumbent players to the emerging disruptors in the U.S. and in more than a dozen countries around the world. ETA members make commerce possible by processing approximately $56.75 trillion annually in purchases and P2P payments worldwide and deploying payments innovation to merchants and consumers.
ETAs membership spans the breadth of the payments industry to include independent sales organizations (ISOs), payments networks, financial institutions, transaction processors, mobile payments products and services, payments technologies, and software providers (ISV) and hardware suppliers. For more information, visit electran.org.
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