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Analysts: Contactless card rollout could push US mobile payment users back to plastic

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CHECKOUT OPTIONS: The jury is out on whether or not the US contactless card rollout will boost use of mobile payment

Familiarity with mobile payments could help to drive adoption of contactless cards in the US but could in turn move those that have already adopted mobile payments back to physical methods of payment, according to a new issue of Auriemma Research’s Mobile Pay Tracker.

It suggests that mobile payment users are more open to tapping their cards because they have been used to tapping with their phone and are more enthusiastic about their adoption, too.

The company’s research showed that three-quarters of mobile payment users have used a contactless card to make a contactless payment, compared with four in 10 non-users.

Similarly, 60% of mobile payment users expressed an interest in using contactless cards compared with just over 25% of non-users of mobile payments.

Others argue the opposite – that the process of tapping a card at the checkout will increase users’ comfort in tapping their phone, a view supported by a recent report from the Federal Reserve Bank of Boston.

Whatever the case, mobile payment adoption is still lagging in the US with only one-third of those with enabled devices having used mobile payments compared with 50% of contactless cardholders who have tapped with their card, according to the Auriemma Research study.

Overall, however, consumers were uncertain about whether they preferred contactless cards to mobile payments, with 65% saying they were about the same, 18% saying they were better and 17% saying they were worse.

“Consumers have been repeatedly asked to change their payment behaviour,” said Auriemma Research director Jaclyn Holmes. “While adjusting to various card payments is easy, the larger switch in the physical mechanism of phone payments takes more time.

“Consumers will have more options at checkout than ever before, but will they choose contactless cards or a mobile wallet?

“Although upgraded terminals benefit both methods, the point-of-sale experience continues to be fragmented for mobile payment users who must pull out their physical card when things go awry.”

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