Imagine running errands with nothing but your smartphone. Stop for a coffee, and pay with your phone. At the pharmacy, your prescription plan appears on your screen for the pharmacist to scan. While grocery shopping, coupons pop up for products you like and use. At the bookstore, you flash your membership card simply by holding up your phone.That day is already here. Mobile wallets let consumers store everything from their credit and loyalty cards to their personal information in one organized, accessible place -- their smartphone.
But while consumers are highly aware of mobile applications like PayPal Mobile, Google Wallet, Starbucks, and Square, and find the convenience and money-saving incentives appealing, many are holding back from using mobile wallets because of security and privacy concerns. Consumers worry about their liability if the phone is lost, stolen or otherwise compromised, and express significant concern that their smartphone will become a greater target for theft if it evolves into a mobile wallet. While consumers love the idea of using mobile wallets for low-risk, easily replaceable items like loyalty and membership cards, coupons, and paperless tickets, they are less comfortable with storing cash on their mobile phones, or using them for highly personal items like social security cards or electronic keys to their car or home.
Companies could address these security concerns by offering significant defensive measures to protect mobile wallets. Consumers are particularly eager for the ability to wipe smart phones clean and replace their mobile wallets easily and instantly. They're also interested in more high-tech protection measures, such as requiring fingerprint identification technology in order to gain access to the mobile wallet. Not only will such preventative and restorative security measures offer customers peace of mind, but many report that they'd be far more willing to use all the capabilities of a mobile wallet -- provided that mobile wallets will be accepted where they want to use them. Many consumers say they want widespread acceptance of mobile wallets at places like retail stores, gas stations, doctor's offices and restaurants, and by law enforcement agencies, before they will leave their traditional wallets at home.
When it comes to managing mobile wallets, consumers place their trust in banks and credit card companies, believing that financial institutions are the most experienced and trustworthy at handling personal and financial information. Other entities, including phone service providers and retailers, are not viewed by consumers as sources to manage the mobile wallet. This echoes a recent PwC survey about customer privacy, in which large financial and utility institutions were also afforded more consumer trust.
For companies, the mobile wallet is a rich opportunity to connect with consumers on the move. Companies that can ease security fears, offer money-saving incentives, and promote widespread acceptance may see more consumers embrace the mobile wallet.
For more information, please go to www.pwc.com/consumerintelligenceseries.
Follow Russell J. Sapienza, Jr. on Twitter: www.twitter.com/RussSapienza