Even as Security Fears Linger in the US, Mobile Payment Options Grow
While it may not be surprising that the US leads the world in credit card debt, the news that Americans are lagging behind other countries in embracing mobile payment technology is initially somewhat surprising. Countries like Thailand and Russia are already widely using social media combined with mobile payment options in far greater numbers than the US, and for a variety of reasons.
A recent study showed that “fifteen percent of Indonesians say they’re happy to shop from their phones, while just eight percent of Americans and Brits say the same.”
Nineteen percent of Americans will comfortably shop from a tablet, compared to 35 percent of those living in Thailand.
In Russia, mobile payments aren’t just being used for shopping, but for the added convenience in paying bills and utilities. Frederic Vanoosthuyze of the Russian telecommunications company MTS, recently explained to the Wall Street Journal that “Mobile payments are growing and have huge potential in Russia given the fact that there are few credit cards.”
Just 5 percent of adult Russians own a credit card, compared with 75 percent of Americans.
One of the major stumbling blocks for Americans to adapt to the new technology of mobile payments has been overcoming security fears. As new ways to pay for goods and services at a faster rate are developed, the ability to steal personal and financial information is still a concern for many.
New methods for combatting cybercrime are in the works, but currently, American consumers are still leery.
While many phones and retailers around the globe are only just beginning to offer NFC chip technology to allow for “wave and pay” technology, Apple declined to install the chips in the new iPhone 5. Workarounds have already been developed for previous iPhone models, by simply using a special NFC-enabled case.
Currently, one of the main benefits for retailers to adopt mobile payment technology was to encourage consumers to be able to make faster purchases, along with being able to offer customers discounts and loyalty points for downloading and using a store’s app. Starbucks has found another advantage in their partnership with Square.
Starting in November, the coffee giant will eliminate their debit and credit card swipe fees and will replace them with smaller transaction charges from Square, who will handle all purchases customers make with a physical card.
How can those without a credit card, like so many in Russia, pay for Starbucks purchases in the future? The Chicago Tribune reports:
Square's global positioning system, or GPS, technology detects the customer's phone in the store. The customer then will "pay" by giving his or her name to the cashier, who will verify it with a name and photo displayed on the register.
Americans who are reluctant to embrace these advancements may be limited in the future in the ways to avoid them. Carrying cash or shopping from home may be their only options.