UK consumers apathetic about mobile payments

Sixty-seven per cent of UK consumers have no plans to use new mobile wallet technology, claiming they are happy with the way they pay today, according to a survey by pollsters YouGov.

While concerns about security and fraud continue to top the list for mobile refuseniks, almost half of respondents say they either don't need a mobile payment system or aren't interested.

Only one-quarter of the 2000+ consumers interviewed by YouGov expressed an interest in using their mobile phone instead of cash to pay for purchases. Of these only one in ten are likely to use the service in the future.

And while five per cent agree that they will get the technology as soon as it's available, the vast majority - almost a half (48%) - won't be rushing to swap their real wallet for their mobile wallet. These respondents agreed it's a good idea but they will only consider mobile payments when any issues have been ironed out.

Lack of awareness may also prove a stumbling block, with more than a third of respondents admitting they didn't know if their phone was equipped with NFC technology.

YouGov tried to put a positive spin on the results. Russell Feldman, the consultant who led the research says: "Retailers, mobile operators and handset manufacturers have a real opportunity to educate consumers about the advantages of paying - particularly for smaller items - in this way. We believe once people have seen it in practice they will be quick to adopt it."

The top perceived benefits for those planning to use NFC in the future are: convenience to pay (87%); the speed of paying (67%); easier than carrying cash and cards (67%); better for the environment (37%); less chance of losing personal information than with paper receipts (35%); being able to keep track of spending more easily (29%).

Early adopters can see themselves buying everything from small purchases like sandwiches, magazines and newspapers (81%), to more expensive items such as CDs, DVDs and games (65%). More than a third (39%) could see themselves making bigger investments including games consoles, clothes and even the weekly shop.

Channels

Retail banking Payments

Keywords

Cards Mobile & online banking

Comments: (4)

A Finextra member 16 June, 2011, 17:25

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Interesting information which demonstrates two important issues: first that you can easily mislead the audience by talking about "mobile" when something more specific like NFC is being talked about (there are other ways to make a mobile payment which are more "mobile" than NFC); and second that the concept of "inchoate demand" applies here - simply put that consumers won't really know what they want until they can actually use it or participate in a realistic trial. To quote Mr Feldman "We believe once people have seen it in practice they will be quick to adopt it"...or not, of course, but the sentiment -actual use is the only true test - remains. If other mobile (non- payment) applications provide lessons it is that when presented with a convenient, useful, mobile solution, other theoretical concerns such as security are swept away.

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A Finextra member 16 June, 2011, 23:01

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Well said Nick. Suggesting that 65% of respondents might use NFC to buy CD's kind of suggests the researchers were not talking to early adopters!

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A Finextra member 17 June, 2011, 10:21

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I think we need to remember that a few years ago, very few in the UK were aware of the possibility of doing transactions via mobile so these results actually demonstrate increased awareness of not only the availability of these type of services, but also the perceived benefits. If we look at analyst views, most are still not drawn on the need for NFC in mobile at all but that’s not to say it will never happen; at present there are just too many other easier/quicker/lower cost ways to make that payment (which will obviously vary country by country).

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Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 17 June, 2011, 12:47

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People having been using their mobile phones for long enough and making cash and card payments forever. They've also experienced the benefits of NFC in contactless cards e.g., with a laptop bag in one hand and several shopping bags in the other, it's a great relief to pass by the Oyster Card reader and get the turnstile to open at a tube station without going having to take out their wallet containing an Oyster Card from their handbag or jacket / trouser pocket (believe me, it works!). They might wonder if using an NFC mobile for such a usage scenario is practical.

Therefore, I'm not sure how receptive an average consumer would be to education around how to make mobile payments.

More than education, a little incentive might work wonders to spur adoption of NFC mobile payments - for example, twice the reward points for paying via mobile as against plastic. Until the resulting question of "who bears the cost of the incentive?" is answered, I won't be surprised to see continuing apathy from banks, and hence, consumers towards mobile payments.