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2013 unlikely to be UK's year of the mobile wallet - ICM

04 January 2013  |  9116 views  |  7 Online shopping buy now smartphone

Smartphone penetration in the UK may be 60% and rising but 2013 is unlikely to be the year of the mobile wallet, according to ICM Research.

A survey of 2015 Brits shows that a third would definitely or probably use their mobile as a wallet to make payments, collect vouchers, to use as event tickets and on public transport.

This figure rises to 46% when asked just to smartphone owners, with younger people more likely to do so, especially 18-24 year olds at 55% and 25-34 year olds at 49%. There is another rise, to half of respondents, when an incentive such as a discount is offered.

However, ICM says that despite this enthusiasm the UK market is simply not ready to embrace the new technology, citing the slow uptake of contactless payments, often seen as an entry point for mobile wallets.

Consumer awareness of contactless may be at 80% but only eight per cent of Brits actually use their tap and go cards. Even if people did want to make NFC payments using their handsets, there are simply not enough models on the market and smartphone users tend to be tied into long contracts that they won't break.

Security also continues to play a major role in holding back uptake - more than half of respondents would use mobiles wallets if their worries about this were addressed.

Bank or mobile providers guaranteeing any financial losses would assuage the fears of 56%, the use of a PIN on every transaction 43%, setting a daily cap on spending 34%, facial recognition 33%, and voice recognition 24%.

Jamie Belnikoff, associate director, ICM Research, says: "The market needs to combine incentives with added security measures and communicate them widely if it is to build consumer confidence that will help drive the adoption of mobile wallet."

One group hoping to prove ICM wrong is the consortium of UK wireless operators behind Project Weave. Vodafone group chief executive Vittorio Colao has told the Telegraph that he hopes the mobile payments JV will launch by the end of the year.

Comments: (7)

A Finextra member
A Finextra member | 04 January, 2013, 12:16

Of course it may take some time for new technologies to be accepted by the vast majority of the society.

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David Abbott
David Abbott - PayCommerce - chelmsford | 04 January, 2013, 13:48

Finally a survey that takes account of more than just a few slanted questions designed to hype mobile NFC/Wallets. The reality is that payments need to be simple, fast, widely accepted and secure....  these are not easy states to attain when mixing payments, downloads, Prepaid Debit accounts, devices, MNO's, Merchants, Regulators and Joe Public. 

The Banks are still well positioned, Pingit is making quiet progress and Apple dont seem to want to play

 

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A Finextra member
A Finextra member | 04 January, 2013, 14:24

So ...

What's a mobile wallet?

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Mark Pavan
Mark Pavan - Mapa research - London | 07 January, 2013, 15:11

Interesting coments,  as active observers and commentators on the sector I must confess that I wish for contactless to come true.

The payment inertia and fear facors are very real and affect the non commited majority; so what about this that I saw in M&S when shopping at lunch time?

A bright paper collar on all payment terminals saying why not pay contactless? Will that help the habit breaking/making?

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A Finextra member
A Finextra member | 08 January, 2013, 03:38

"However, ICM says that despite this enthusiasm the UK market is simply not ready to embrace the new technology, citing the slow uptake of contactless payments, often seen as an entry point for mobile wallets."

Interesting survey results, and an even more interesting conclusion that takes a different stance to the reported survey results.

It begs the question as to really what is the link between 'wallets' and 'contactless payments', as the later offers little difference to the consumer and merchant other than a faster transaction time.

Despite carrying around two 'contactless' capable credit cards in my wallet for the last two years, I've never had the urge to use the 'contactless' feature even though many of the retailers I visit can support it. The technology may be nice, but the payment experience is not sufficiently different for the average consumer to change their ways.

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Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune | 08 January, 2013, 08:15

Security is only a bogey for the lack of compelling reason to make payments with mobile wallets. Provide a powerful value proposition for mobile wallet - e.g. Wallaby meets iOS Passbook - and watch security concerns vanish. Millions of people have taken the risk of handing over the keys to their bank and credit card accounts - okay, I meant logon credentials to their Internet Banking accounts -to Mint, BillGuard and other really useful services, there's no reason why they'd let security concerns come in the way of adopting mobile wallets if only they got something really valuable in return.

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A Finextra member
A Finextra member | 08 January, 2013, 08:50

So ...

What is a Mobile Wallet?

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