Despite efforts by major card companies to promote the speed and excitement of using mobile phones to pay, it likely will take more than glitzy marketing to convince consumers to use such services, according to a Federal Reserve strategist.
MasterCard Worldwide in the United States and Barclaycard in the United Kingdom (
“The reality … is that consumers will have to learn how to use mobile payments step by step,” Marianne Crowe, vice president of payment strategies at the Federal Reserve Bank of Boston, told PaymentsSource in an interview. “They may try it out once and then get a little more comfortable with it. And in that case, over time, it could be a success.”
Adoption of mobile payments might mimic the adoption of online banking; consumers would try paying a bill online to one innocuous biller just to make sure that it works, she said. They then would build up to paying all of their bills and also making person-to-person payments to the babysitter via online banking.
Many factors must come together to promote mobile payments, including addressing consumer concerns about the security of having a payment device on their phone, Crowe adds. The Boston and Atlanta Fed’s research suggests security is one of the top reasons consumers cited for not wanting to conduct mobile payments, she said.
Not only should service providers ensure their systems and devices are secure, consumers also should learn to protect their passwords and not download applications that could lead to a data breach.
Crowe was one of several authors from the Federal Reserve banks in Boston and Atlanta who penned a mobile payments road map paper released in March that detailed the state of the mobile-payments market and what efforts are needed to develop mobile payments (see report).
