Have You Replaced Your Wallet With Your Phone Yet?

We use our phones for just about everything. And because they are so versatile, many have asked if at some point, our phone will replace carrying a wallet. While the jury is still out on that, there is plenty of evidence to suggest that things are trending in that direction.

How To Replace Your Wallet With Your Phone

The three main services to use to ditch your wallet are Samsung Pay, Apple Pay, and Android Pay. Each service is still very young and have only been around for a year or two. They all have similarities, but there are a few main differences with each service as well.

Some work with traditional terminals (Samsung Pay), while others like Apple Pay and Android Pay have the advantage of working for in-app purchases. They all work with NFC terminals. Many big chains like Walgreens, McDonalds, and Subway have NFC terminals, but it will take years for other chains to follow suit.

The reason NFC-enabled terminals are best is that your actual card number does not get transferred – ensuring that hackers can’t steal it.

All three services work with major banks like Chase, Bank Of America, Citi, and more. But with each service, not all phones are supported and the ones that are usually are the higher end or newer models.

Why Replacing Your Wallet With Your Phone Is Still A Ways Off

While we see the steps being taken by the three services mentioned above to ditch our wallets, there are still plenty of barriers keeping people from actually doing it.

One big reason is that almost all of us carry more than just cash or cards in our wallet. Our ID is an essential piece of most wallets, and until each state makes IDs digital, it will be hard to get rid of our wallets completely. The other big factor, and the biggest for most, is security. And while this is being addressed and improved constantly by the providers, people just aren’t convinced yet.

One report from 2015 found that around 80 percent of iPhone 6 and 6+ users with access to Apple Pay have never tried it.

As for the security concerns, 62% of people asked in a recent poll of non-users, (who have not waved or tapped a mobile phone at cash registers in the last 6 months and have no intention of doing so in the next 6 months) cited security as the top reason why they aren’t using the service. While this is down from 73% in 2013, it’s still a major concern.

The other major barrier is that these changes just take time. For many, it has taken years and years to break the habit of writing checks at the point of sale. And while mobile wallets have become common in the past decade in India, Japan, and Kenya, many U.S. consumers just want to stick with what they know and consider more convenient and safe.

But the great news is, these services are young and growing. With new security measures, features, and accepting stores popping up all the time. So while your phone might not replace your wallet completely anytime soon, that time is coming and is something worth looking forward to.

 

 

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Joe Long