Mobile money and payments is failing to live up to the hype and is not delivering anything for either consumers or merchants finds a study by mobile payments company MPayMe.
The survey of 1500 UK adults shows that despite the plethora of mobile wallets and well over half of the UK population owning the smartphones needed to use these wallets, less than 10% of smartphone users made a point-of-sale payment. This, believes MPayMe, is because the industry is focused on payments, an area that’s not broken nor in need of being fixed.
In terms of merchants, very few are set up to accept mobile payments. As part of the study, MPayMe examined merchants on Oxford Street – Europe’s busiest shopping district – and found that only 7.5% are able to accept mobile payments.
The company believes that mobile money is failing consumers and retailers for a raft of reasons and that the retail and payments industries really need to take a look at the wider picture of where payments fit into people’s lives.
According to MPayMe, mobile payments needs to be part of a wider focus on money. So far the focus has only been on payments and not other forms of money and lifestyle management. The solutions on offer are also often restricted to a single channel, such as online or in-store, which means customers need multiple applications, while the majority can only be used domestically, unlike most credit and debit cards, and so are of limited overall use and unlikely to replace cards.
MPayMe goes on to (rightly) criticize mobile wallets as being unable to actually offer the functionality to replace real world wallets and, perhaps most tellingly, being aimed almost exclusively at retailers, despite retail spend making up only a very small fraction of the average household outgoings.
Hooman Mazaheri, European CEO of MPayMe, explains why the reality is so different to the claims: “With one or two notable exceptions, the biggest retailers and merchants in the UK are slow in adopting this new technology. It’s a similar picture for consumers too. The products currently being offered often have too many limitations and don’t offer the value or the utility to drive merchant and consumer adoption. When there are already well-established and traditional ways to pay, i.e. cash and cards, what’s the benefit of introducing a rival if it doesn’t come with added value?
“What’s needed is a solution that addresses the real and diverse needs of merchants and consumers. Yet another method of payment isn’t enough unless it comes with add-ons such as data and loyalty scheme management for merchants, and a relevant, versatile and wider-reaching customer experience for consumers.”
