Paying with smartphones to outpace credit cards & cash by 2020, experts say
Cash? Forget it. Credit cards? How dated. More than two thirds of technology insiders believe that paying with smartphones will overtake both credit card payments and cash payments by the year 2020. Incredible as it may sound, Near Field Communications (NFC) technology is expected to build enough inertia over the this decade to cement its role in our daily lives. Is this possible? Read on. Governments love this stuff!
The survey – conducted by the Pew Research Center and Elon Univeristy – noted that most companies already involved in financial services market will try to resist the shift towards NFC technology to avoid losing market share. That being said, there are signs that some major players are on board. Visa’s recently announced “one-stop” NFC-based mobile payment solution is one notable exception to the obvious recalcitrance that major, established financial institutions would have. On the other hand, there are a few big companies, as well as a few unique initiatives, that support NFC payments. Google Wallet uses NFC technology, as does ISIS, the NFC mobile payment system backed by several mobile carriers such as Verizon, T-Mobile, and AT&T. Apple is expected to come up with a payment system of their own by the end of 2012, one that is expected use NFC as well. An alternative to NFC technology is perfectly showcased by Square’s “Pay with Square”, a payment app that relies on geofencing technology rather than on NFC.
Video of Pay with Square
“There was a relatively strong notion that it’s something that may not happen really quickly due to the reluctance of incumbents to cede their place in the market,” one analyst noted.
Unfortunately, the NFC universe is not perfect by any means at its current state. One example on this topic is the recent finding that Google Wallet can be hacked, something that doesn’t exactly make people trust NFC payments more than credit card payments. However, if the technology insiders interviewed by the survey turns out to be right, the reluctance of the general public to use mobile payments over credit cards or cash will slowly but surely fade away by the end of the decade. Given the importance of the financial transaction market, I’m sure the battle has only begun, so it would make sense to expect a lot of twists and turns regarding the future of mobile payments.
What do you guys think? Will mobile payments take off and represent the main method of payment by 2020? Or are credit cards the best conceivable method for purchasing something? Drop us a line in the comment section below! It’s free, naturally!