The Pocket Merger: Your Phone is Becoming Your Wallet. Will Your CU Be Prepared?ShareThis
by Ron Daly
I'm an iPhone guy. When most of my peers were pecking away at a Blackberry hard-key, I was tapping and swiping my touchscreen wonder-phone. I'm currently working with an iPhone 4s, having bequeathed my old phone to one of my kids (who dropped her iPhone and shattered the screen).
As someone who sits watching at the cross section of technology and finance, I'm fascinated by the idea of the "mobile wallet". I read a little more about it every day and, despite all my reading, I'm not quite sure what to think. Yes, interest is growing, but it's still small. Yes, the tech advancements are impressive, but also scattered between the people who were already handling payments (Visa, Mastercard and the like) and the start-ups (or is it "upstarts"?) out to stake their claim (Paypal, Square, Isis). Cheap, plastic doodads jut out of your phone that let you physically swipe a credit card with your smart phone. Suddenly, your smart phone's a wallet AND a cash register.
And a bank account? Time will tell, I suppose, if the merger between your phone and your wallet puts CUs at risk.
I pulled a few recent articles about the topic that I think are worth reading:
Mobile Monday: Square Wallet Provides a Sneak Peek at the Future of Proximity Payment (Jim Bruene, NetBanker, full story here)
"And all your previous transactions, with full itemized receipts, are available within the Square app... It's truly the future of payments available for a sneak peek today. I highly recommend giving the Square Wallet a try."
Are Bankers Ready for The Bank 3.0 Reality? (Jim Marous, JD Power Banking Blog, full story here)
"[Quote from Brett King] The problem is that there are so many start-ups in the financial services and payments space that are impacting the way people view financial services that significant technology projects need to be undertaken by traditional banks just to keep pace. Investing in a technology layer, combined with the new costs of compliance, will be a challenge for smaller institutions. That doesn’t eliminate the potential for smaller organizations to collaborate or to build partnerships to respond to market realities, but I don’t see this happening."
Will You Be Ready When Mobile Wallets Turn Banking Upside Down? (Jeffry Pilcher, The Financial Brand, full story here)
"No matter what consumers today say they think of mobile wallets today, mobile wallets will triumph. Why? Because mobile wallets will simplify consumers’ lives in very personal and relevant ways. For starters, they eliminate the nuisance of thick, cluttered wallets. They also reduce the transmission of germs, because they eliminate plastic cards, pens/signatures, touchscreens and keypads."
Mobility Matters: The Mobile Wallet Wars (Robert McGarvey, cutimes.com, full story here)
"If you are skeptical about digital wallets know that the skeptics may outnumber believers, at least among financial services executives. Forward motion towards wider wallet adoption has seemingly gotten just about nowhere in the past year. Few consumers have ever used one, few mobile devices have a digital wallet capability, and not many more retailers are equipped to accept them anyway.
But ask the experts and their advice is consistent: ignore digital wallets at your own risk because they are the future.
That clock is ticking."
Stop Spewing Mobile Wallet BS (The irrepressible Ron Shevlin, at Snarketing 2.0; full story here)
"If I've learned anything about doing consumer research it’s this: You can’t ask consumers their opinions about things that they don’t know. So, feel free to publicize your research about which mobile wallets are most popular with consumers, if you want, but I’m not buying any of it."
What are your feelings on the topic? Are you eager to pay for things with your smartphone? Think it's trouble brewing? Tell us more in the comments.