Almost one in six US consumers (15%) have used a mobile wallet in the past six months, up from 9% in the same period in 2013, and an additional 22% are likely to adopt mobile wallet functionality in the coming six months, a study released by market research and consulting firm Chadwick Martin Bailey has found.
Some 18% of the 1,716 consumers surveyed for The Mobile Wallet in 2015 and Beyond report said they are “very familiar” with mobile wallets, compared to 8% in 2013, while 44% said they are “somewhat familiar” compared to 42% in 2013 and 37% said they were “unfamiliar,” a decrease from 50% two years previously.
Among mobile wallet users, 61% have used PayPal with an average 88% satisfaction rate, 38% have used Amazon (84% satisfaction), 31% have used Starbucks (93% satisfaction), 31% have used Apple Pay (89% satisfaction) and 31% have used Google Wallet (82% satisfaction).
PayPal is the preferred wallet provider among respondents with 71%, followed by Apple with 55%, Amazon with 49%, Google Wallet with 48% and Microsoft with 34%.
More than one in four (27%) mobile wallet users say they are also “very likely” to switch to other businesses if they offer mobile payment capability, and 18% would increase their business if mobile payment capability was present. Meanwhile, 44% want extra rewards and points when using a mobile wallet, in addition to those they get with a credit or debit card.
A falling majority (63%) said they do not use mobile wallets and have no plans to do so, compared to 71% in 2013. Security was cited as the number one barrier to mobile wallet adoption by 62%, down from 73% in 2013, while 40% said they do not want to pay any fees, 26% say they do not want the store to have their mobile wallet information and 19% say it’s not as convenient as using cash or a credit card.
Furthermore, 15% cite the fact that there is no single payment system across merchants is a barrier to mobile wallet adoption, while 14% believe credit cards have better rewards, 13% don’t know which app is best, 10% say the technology doesn’t always work properly, 9% say it’s not available in the stores they would like to use it and 8% say mobile phone screens are too small.
Nearly 40% of those who are “highly likely” to buy a wearable device in the coming year say they want it to come with mobile wallet functionality with the majority of likely wearable buyers claiming that the presence or absence of a mobile wallet has a major impact on their purchase decision.
“Our findings reveal that mobile wallet and wearable categories are set to expand rapidly and there is no clear winner in sight just yet,” says Jim Garrity, senior vice president of Chadwick Martin Bailey’s financial services practice.
“The key to success will be to hammer home messaging around benefits and security while simultaneously working to make the technology a natural extension of the user through incentives, alternate uses of wallet and spend management, faster than competitors.”
The research also reveals that 13% of Chase and American Express credit cards have been uploaded to a mobile wallet, as well as 14% of credit cards from Visa, 11% from Bank of America, 8% from Capital One and Discover, 9% from MasterCard and 3% from Citibank and Wells Fargo.
Meanwhile, 13% of Visa debit cards have been uploaded to a mobile wallet as well as 14% of debit cards from Bank of America, 7% from Chase, 8% from MasterCard, 6% from Wells Fargo, 5% from Capital One and 3% from Discover and Citibank.