Most consumers in mature markets (i.e. North America, Western Europe, Japan) will use smartphones or wearables for mobile payments by 2018, according to advisory company Gartner.
“Innovation in apps, mobile devices and mobile services are impacting traditional business models, particularly in the way people use personal technology for productivity and pleasure,” said Amanda Sabia, principal research analyst at Gartner. “Product managers must understand who their customers are for these new devices and services, and how the products are being used. Knowing your customer is imperative in order to capture a fair share of spending opportunities in this dynamic marketplace.”
For the moment, three types of mobile payments or mobile wallets are available: smartphone or wearables-based payments, branded mobile wallets from banks or credit card providers, and branded mobile wallets from retailers such as Starbucks.
Gartner says mobile payments using Near Field Communication (NFC) technology (Apple Pay, Samsung Pay and Android Pay) will be limited in the short- to mid-term due to a lack of partnerships between retailers and financial organizations, as well as consumers seeing little value in such payments.
“Any mobile payment wallets that are tied to the device will have limited adoption and only if the device has a huge installed base,” said Annette Jump, research director at Gartner. “Instead, cloud-based solutions will have a better chance to succeed as they can reach a wider audience and can support many use cases beyond face-to-face or in-store options. Also, mobile payment and mobile wallet adoption requires a country-by-country rollout plan with an enabled payment infrastructure and agreement with major banks and retailers.”
Some 87% of security specialists expect an increase in mobile payment data breaches over the next 12 months, yet 42% of respondents have used the payment method in 2015, as HOTforSecurity noted in September.
Here is a short list of tips to stay safe while paying online:
- Understand your level of risk: Ask yourself what level of personal information and financial loss is acceptable to balance the convenience of mobile payments.
- Know your options: Understand the security options available to bring your risk to an acceptable level. Using a unique passcode should be mandatory, but also look into encryption, temporary codes that expire and using multiple ways to authenticate your identity.
- Value your personal information: Be aware of what information you are sharing – e.g., name, birthday, national identification number, pet name, email or phone number. Hackers can use these pieces of information to access accounts. Provide the minimum information necessary for each transaction.