Consumers Trust Credit Card Companies Most For Mobile Payments

Despite increasing activity involving mobile payments, consumers still trust credit card companies more than companies such as Google Inc., eBay Inc. or Facebook Inc.

In fact, the popular social media phenomenon Facebook ranked last in terms of what companies consumers would trust to support mobile payments in an Ogilvy & Mather Worldwide's online mobile-shopper survey of 500 U.S. consumers, Gareth Evan, director of digital at OgilvyAction, a division of Ogilvy & Mather, tells PaymentsSource. The marketing communications firm conducted the survey two months ago in June.

 “With so much buzz and hype about the mobile space, the purpose of the research was to truly understand what the consumer shopping perspective is” toward mobile payments, says Evan. 

Ogilvy & Mather, one of the world's largest advertising and marketing agencies, says more of its clients are considering developing mobile applications. “When we talked to consumers as well as brand manufacturers, vendors and retailers, we started to see themes come out, and one of them was trust in new services being offered,” says Ellen.

Consumers trust the card companies more because they have been providing secure payments online for many years, says Ellen. Consumer trust will develop for future mobile-payment applications, including Near-Field Communication-enabled smartphones, as more players work to develop security standards the same way credit cards did for online transactions in the past 10 years, he says.

Visa Inc. topped the survey list, with 39.5% of respondents saying they trusted the brand more than other companies. MasterCard Worldwide was second with 35.9%, and American Express Co. ranked third with 35.8%.

Visa rolled out a digital-wallet service in May with several bank partners in the United States and Canada (see story). In June, the card brand sought to expand its mobile-payments opportunities with unbanked consumers outside the United States with its investment in South Africa-based mobile payments company Fundamo (see story).

Visa, MasterCard, Amex and Discover Financial Services have joined the mobile-payments initiative Isis, along with several wireless carriers (see story). Discover was not included in the Ogilvy survey.

Amex is promoting its Serve digital payment and wallet service, the company said in August after announcing partnership deals with two mobile carriers, Verizon and Sprint Nextel (see story).  Amex also is positioning its undisclosed investment in mobile-payments company Payfone Inc. as the next step in adding additional functionality to Serve (see story).

Facebook, however, was last on the trust list in Ogilvy’s survey with only 12.1% of participants saying they trusted the brand, and it is unclear whether the company will pursue mobile payments as part of its offerings.

“An element of surprise was how far behind Facebook was. But in terms of issues they have around privacy, it seems to play out that consumers had to consider if they really wanted to put financial information into that mix,” Evan says.

The other surprise was that eBay Inc. also ranked so low, despite the fact that eBay has developed a solid mobile platform for shopping, Evan says.

However, eBay-owned PayPal ranked fourth, just after the credit card companies (see chart). PayPal is a proven payment alternative that consumers trust because it has been on the market and is well-used by consumers, Evan surmises.

As of June 30, PayPal’s active account total reached 100.3 million, up 15% from 87.2 million a year earlier. The unit’s net total payments volume rose 34.7%, to $28.7 billion from $21.3 billion.

EBay has said that even merchants might not support up-and-coming mobile payment options, such as NFC (see story).

What do you think about this? Send us your feedback. Click Here.