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Digital Wallets Have Yet To Catch On, JPMorgan Executive Says (reuters.com)
Despite major tech companies working aggressively on making digital wallet solutions available everywhere, these digital payment apps in our smartphones are yet to gain traction, according to Chief Executive of Consumer Banking JP Morgan Chase & Co. From a Reuters report: Apple Pay, Android Pay, and Samsung Pay are being used for less than 1 percent of payments at retailers, Gordon Smith said, citing industry data at an investor conference. Ultimately, the convenience of paying with phones will bring a surge of use from consumers, but it is impossible to know when that inflexion point will be reached, said Smith.
I bank with a decent sized local credit union. After they got finished patting themselves on the back for their technological advancement rolling out EVM cards, they refuse to support any of the digital wallets, including Apple's, Android's, or Samsung. Their reasoning (at least as of December 2015) is that no one is using them.
Well, it's kind of hard to use them if you don't support them and permit the card to be tied to a digital wallet. So we have a chicken an an egg problem. They won't be supported until usage goes up, and usage won't go up until they're supported.
I don't go out and about without my wallet, so my credit card is always on me. Using an app isn't any more convenient, its less so. And I have to figure out the risks and insecurities of a new method of payment. I'll just keep swiping my credit card instead, thanks.
I mean really- who the hell really thinks taking out your phone, unlocking it, moving it over a sensor, and typing your pin into an app is more convenient then taking a card from your wallet and making one swipe?
I still have more fans than freaks. WTF is wrong with you people?
The end user wants a single system that will work at most of the places they buy things at, regardless of whether they switch back and forth from iPhone to Android, and regardless of which bank and credit card they have.
Until the various industry players swallow their greed and agree to get together in a strong standards definition and implementation process and revenue sharing process that gives users this kind of universality, the momentum will continue to stall.
Where are we going and why are we in a handbasket?
First, I don't trust the security of the phone. There is nothing on my phone that I would care about if a hacker got it. No logins, no passwords, no addresses. Just a couple apps and several phone numbers.
Second, I don't see why I should give big companies yet another chance to mine my data. Especially something as sensitive as my spending habits. I still use cash a lot for this very reason, every year my credit card company sends me a statement showing me exactly how closely they track my spending.
The MCX, which has Walmart and CVS in their membership, wanted to push their anti-consumer CurrentC app so they could avoid credit card charges.
CVS even had a working mobile wallet payment system working with Android, but disabled it when Apple Pay was launched.
When the world's largest retailer doesn't want to support something, it gets hard to adopt it.
http://www.macrumors.com/2016/...
Grammer Nazis - I mod you "troll" unless you actually add something on-topic. Yes, I know I have mispellings in my sig.
I fail to understand why I'd want to pay with my phone.
A) Cash never runs out of battery, and the merchant can always verify it's valid without a network connection
B) Credit cards never run out of battery, and there's a backup process for when the terminal can't call home to momma (although imprint machines scare anybody under 30 if they have to use them...)
C) Mobile OSs are subject to security holes that are being actively pursued
D) I have to carry a wallet anyway. Drivers license, health insurance cards, *cash*, etc. So what does it gain me?
Seriously, this is the standard "wouldn't it be cool if your smartphone could..." sort of thinking, without pondering if it's really better to do those things with a smartphone.
"impossible to know when that inflexion point will be reached" - who says it's ever going to get there? There's a LOT of skepticism about the security of this kind of transaction, coupled with the fact that it really doesn't solve a problem the consumer has - it's not simpler than a credit card transaction (you still have to take a token out of your pocket, and perhaps type a pin or whatever). It's not particularly faster for the consumer, and it doesn't cost the consumer any less money.
If you want something to take off, it's got to be BETTER in some way than what went before (or, you have to cut off the thing that went before so the consumer doesn't have a choice). Neither of those things is happening, so why does this guy assume that it's ever going to take off? I kind of assume it WON'T at this point.
A thousand pounds of wood moving at 300 feet per minute. Don't get in the way.
>Could it be we are just waiting for a bank somewhere to step in and say "Yes, we will take full responsibility for any and all damages to your account should anything at all go wrong"?
That's *exactly* the way credit cards work.
TODO create witty sig.
In fact, it's not worth shopping at anywhere but Amazon anymore anyway...
Peter predicted that you would "deliberately forget" creation 2000 years ago...
Tokenization to protect your card from vendors and requires your fingerprint for security vs tap which requires nothing but the card.
Home Depot and Target can't lose the credit card info you never gave them.
That's a very nice step forward.
When I hand over a bunch of dirty green paper, it just works. When I swipe my card, it just works (though there's a bit of confusion on whether to swipe or cram). Apple/Android Pay isn't there yet, and I'd rather use what I know works, rather than fumble with my phone and have it not work.
Slow down, cowboy! It has been 4 hours since you last posted. You must wait another few hours.
If properly implemented, and it seems Android and Apple do, contactless payment via your smartphone is a lot more secure than anything else. Some advantages it has:
1) A proxy number can be used for each transaction. Your real number need never be used at any time, as a proxy can be created for each transaction. The bank lets the phone know what proxies to use, and the phone lets the bank know when they are used. so even if the merchant gets completely owned, the information gleaned on you is useless as it was valid for that transaction only.
2) You have a device that can notify the bank of the validity of the transaction. Not only will the payment terminal contact the bank for payment, but your phone can let the bank know as well. Now there has to be some slack built in the system to make sure that it can work even if you don't have signal, but basically when your phone gets back on the network if the transactions don't agree, a flag can be raised.
3) You have some defense against a compromised terminal that overcharges (basically a merchant that has messed with their terminals to charge a different amount than displayed. Your phone knows how much the charge was, and shows it to you. If that is different from the amount on the screen, you can contact your bank there and then and stop the transaction.
4) The two-factor auth is taken off the device, on to your device. You have to unlock your phone to use the payment, so you have a 2-factor setup (your phone + either code or biometrics). However with chip+pin, the pin is entered on the terminal so if it is compromised, it can get your pin. The terminal can't get anything when a phone is used as the auth is on the phone, not the terminal.
It isn't flawless, but it is a decent step up from the security of just using a card.
While I have no problem with others that want to pay with their phone, I personally have NO interest in doing it myself.
I don't want any more of my info on my phone than there already is, certainly not my methods and ability to pay.
I prefer to use good old CASH for most of my daily, meatspace transactions. I take out a few hundred each week, and I can easily see what I'm spending in hard currency, rather than lose track easily during the week/month with the abstraction that is credit..
To me, a CC is like a chip in a casino, and it doesn't associate as well with real money spent. I think it is even worse on a phone as that you don't even have go throught the muscle memory action of physically pulling out a card, using it and replacing it in the wallet.
While I have no problem with folks that do wanna use their phone to pay, I can fully understand the myriad of reason one would not like to.
If nothing else, what happens to ones ability to pay if your phone dies?
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
Totally would do this, but:
1) Apps refuse to start on rooted/jailbroken phones.
2) There are about umpteen dozen payment systems that do not support each other.
3) Invariably retailers only support at most one or two (which your particular phone does not have).
4) Only a tiny fraction of retailers even support that one or two.
So the result is that you spend all the time setting it up on your device, and then walk around for months never seeing a place where you can use it. When you finally, finally do see a terminal that claims to support the network that your app uses, and you try to start it, you get a pop-up saying, "For security reasons you can not make payments from a rooted and/or jailbroken phone."
In short, people are willing to use it but the corporate world is fucking it up (again).
STOP . AMERICA . NOW
Your iPhone doesn't store your actual card number (termed a "Primary Account Number"). When you add your card to Apple Pay, your bank creates a "Mobile Device Number". Your bank keeps the association while your phone uses the MDN to pay, so that's the number the merchant sees. If their systems are later compromised, your bank knows something is wrong if they see the MDN used in a non-Apple Pay transaction.
Apple Pay doesn't require entering the PIN. You can also authenticate using your fingerprint. But since the phone doesn't transmit card details to the terminal until after you authenticate, it's more secure than using an NFC card. A merchant who upgrades their terminals to recognize CDCVM can allow contactless payments in excess of the limit for NFC cards (GBP 30 in the UK, $100 in Australia, etc).
End of Line.
Here in the UK, a lot of places accept a whole bunch of digital payments but yet most people still use their debit cards or cash. There are many reasons for this but it is not because of outdated terminals, just about every Sainsbury's or Tesco accepts digital payments.
The reasons people don't use so-called "digital wallets" are:
1. They're just wrappers for existing products. To avoid the requirements banks have to adhere to, most will just charge to your credit card. If they held money for you then they'd have to be properly PCI compliant, instead they let your financial institution worry about PCI compliance and just serve as an intermediary for that service.
2. They're less convenient. Getting out your card and typing your PIN is faster and easier, cash is even easier and faster.
3. Layer of obfuscation, when tracking your spending you now have another party in the mix.
4. Ultimately they are more expensive. When you add more parties into the mix, they each have their hand out for a portion of the purchase. This means the merchant has to put their prices up to compensate for having to pay more fees to accept payment. This is why cash is still king. you don't have third party providers asking for a cut.
5. "Digital" means it runs on a battery, batteries run out.
6. People are scared of having their phones lost, stolen or broken. To be fair there is a bit of merit here, if I drop my wallet all of my cash and cards are fine, if I drop my phone I have to hope it still works.
Basically, digital wallets are a solution looking for a problem. Until providers actually decide they want to be banks rather than wrappers for your credit card and go full PCI compliant, they wont be a popular alternative.
In fact I think banks, who are notoriously conservative will take the initiative first and go digital. I believe a few Australian banks already offer cardless withdrawal services where you can get a pin code on your phone and type that into an ATM/Cashpoint to get out a small amount, A$50 or so from memory.
I prefer to use good old CASH for most of my daily, meatspace transactions.
As do I.
But I use all forms of payment, cash, debit, credit and direct debit/bank transfers. I use the form of payment most appropriate to what I am buying. Only a fool discounts a potential form of payment, only the heir to the throne of the kingdom of fools limits themselves to just one. That being said, I treat credit like the sugar of the personal finance diet. A little sugar is fine, a diet consisting of 90% sugar means you have problems.
Calling someone a "hater" only means you can not rationally rebut their argument.