Consumers don't understand contactless cards

Source: Auriemma Consulting

Contactless credit cards allow cardholders to wave-and-pay at checkout terminals fitted with contactless technology sensors.

This new technology, which has cost the industry millions in development and marketing, is not yet the smash-hit that industry leaders had expected. In a recently published issue of Cardbeat, a syndicated market research report conducted by Auriemma Consulting Group (ACG), consumers have indicated that contactless technology is not an easy sell. In light of the credit crunch, and increasing insecurity about the risk of identity theft, consumers need additional encouragement to acquire a new card - even if it features a compelling new technology.

Highlights from the study include:

  • Only 3% of the population is familiar with contactless technology. Clearly, the card industry's next task is to educate the consumer to increase understanding of this payment method.
  • Consumers want contactless cards after learning more about them. After reading an explanatory paragraph about contactless payments technology, consumers were 7 times more likely to want a contactless card than before they read the description.
  • After reading the description of the technology, 63% of consumers would use a contactless card more than a standard credit card because of its "cool new technology." 67% of consumers would use a contactless card more than a standard card due to its "ease of use."
  • 23% of consumers would not use contactless cards because of concerns of identity theft; a robust education-focused campaign should address this concern.

Matt Simester, Director at Auriemma Consulting Group comments, ‘evidence is quite clear that the consumer is not familiar enough with contactless cards in order to make a decision to own one of these cards. Education is the single most important change that lenders can do to drive consumers towards contactless card acquisition.'

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