Pay-By-Smartphone Still Suspect

A new survey, conducted by Radius Global Market Research, shows that the majority of Americans remain quite skeptical of smartphone generated payment solutions and in the near-term, are not likelyto give up traditional forms of payment, though the number of smartphone users has increased to nearly 50% of all U.S. consumers.

Chip Lister, Managing Director of Radius, says “… thebenefits of convenience, speed, and portability, are resonating with a niche population of younger consumers… but… there are important obstacles that must be addressed before pay-by-smartphonetechnologies will be widely adopted… “

Half of all American consumers say potential security and fraud significantly influence their likelihood to use smartphone technology to makepurchases in the future. In comparison, only 14% say security and fraud don’t influence their future likelihood to make those purchases.

The segment most likely to make purchases viasmartphone, consumers under 35 and those identifying as digitally savvy, are also the most likely to be concerned with security and fraud issues. 54% of consumers under the age of 35 are concernedwith fraud. that figure rises to 62% among digitally savvy consumers.

Lister says “… the more the consumers know about smartphone technology, the more they worry about the security ofmobile transactions… marketers have done a good job at promoting convenience… (but) need to boost messaging efforts to address security concerns… (to) convince digitally savvyconsumers…”

Several branded product and service providers are involved in executing a single smartphone generated transaction, complicating messaging efforts further. Responsibilityfor flawless delivery is spread across several partners.

Lister concludes that “Consumers appear to be very aware of the entire delivery chain associated with mobile payments…Individual brand reputations of retailers, device makers, software developers, service providers, and financial institutions will be scrutinized (by consumers)…  In (their) minds the completetransaction is only as strong as the weakest link, especially as it relates to security… (and) consumers don’t currently view banks and credit card companies as leading the way in the effortto develop innovative payment technologies… “

For additional information about the study, please visitRadius global market research here.

Pay-By-Smartphone Still Suspect

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