Monday 7th January, 2013

According to research from ICM Research carried out before Christmas 2012 - the ‘Mobile Wallet’ is very unlikely to take off this year. The research reveals a short fall in consumer take-up that is due to; lack of retailer support, consumer security concerns, lack of in-store promotion and device limitations.

The research discovered that contactless payment – which many consider the entry point for Mobile Wallet – is still very much in its infancy. Whilst consumer awareness is high at 80%, only 8% of people actually make contactless transactions. The reasons for this mirror the barriers to Mobile Wallet take up. Firstly, a lack of retailer support with few terminals and little or no in store promotion. Secondly, widely held consumer security concerns have not been addressed.

Smartphone penetration is growing yet many smartphone users aren’t tech savvy. M-Commerce is certainly popular, but relatively few transactions happen via the mobile handset. The responses from consumers about security concerns, and their willingness to accept pin numbers and other measures that go against the somewhat casual ‘wave and pay’ ethos of contactless paying highlight that there’s more work to be done to promote Mobile Wallet.

ICM also believes that brands also aren’t doing enough to connect with their customers using the mobile tools we know they are already comfortable with, particularly apps. Only one high street retailer is utilising apps specifically designed to help with Christmas shopping – a real missed opportunity.

There simply aren’t enough NFC enabled smartphones which means many people can’t yet make contactless payments by mobile even if they wanted to. As smartphone users tend to be tied into long contracts.

Jamie Belnikoff, Associate Director at ICM Research who led the research concludes: “Mobile wallet is about more than just paying: it allows consumers to manage their vouchers and discounts, loyalty cards, event tickets and public transport passes all in one place. Whilst people appreciate these advantages, they expect a range of incentives and benefits to get them to pay this way. However even with this encouragement, their genuine security concerns – and as we’ve seen in our recent research into contactless payments, – the lack of terminals in shops and absence of in-store promotion are also preventing broader consumer take-up".