Tis the season so spend money on presents for under the Christmas tree – how will you pay for those gifts? Perhaps you might try a your new Google Wallet, or your ISIS Wallet, MasterCard PayPass Wallet, Samsung Wallet, Apple Passport, Square Wallet, or maybe LevelUp Wallet – you can pretty much leave them all at home and just bring you leather wallet with your "old fashion" credit cards. Most merchants simply do not accept "Electronic Wallets," so put your smartphone away and grab your cash.
The concept of a "mobile wallet" is not a new concept and many companies, including Google, have been trying to get them accepted for years. Most phones did not have the secure NFC chip built-in to them, and Apple still refuses to include one even in their new iPhone 5s – most people believe that if Apple would make that first step, the merchants would scramble to adapt to the mobile wallet. That is a shame because the Android platform is growing each year in the U.S. and is number one in the world. Our friends over at ReadWrite went on a shopping trip and checked out the stores below and compiled this list of what establishments accepted Mobile Payments – if you take away the four stores that sell smartphones, you are left with only CVS, Starbucks, and Teavana (owned by Starbucks)…a pretty poor showing.
It upsets me because I would love to use a mobile wallet, as I hate to carry cards or even a wallet around with me. I use my smartphone for my Starbucks – it's so easy to have my Starbuck's app keep track of my points, balance on my card, and a way to instantly reload the card with additional funds. It would be nice if I could use my smartphone for all of my purchases, after all, it is always with me, so why should I have to carry an additional wallet full of debit or credit cards that could easily get lost or stolen. Just handing your credit card over to a store clerk is risky and it gives them a chance to copy your 3 digit security code.
So why isn't the mobile form of payment more widely accepted? It can be summed up in one word, okay, maybe two – there is no "standard" and good old-fashioned "greed." What if the companies that made all of the lamps in your home each had a different plug on them – it would be a mess. The same with mobile wallets, none of the companies can decide of a standardized system, and without this standardization, the merchants would be forced to either accept only one or have equipment on hand to accept each individual wallet, and that is an expensive solution that will never happen.
Everybody thought that the secure NFC (Near Field Communication) would be the way to go, but manufacturers were slow to include the secure chip in their newest devices, especially Apple – the merchants were waiting for Apple to include the NFC chip in their iPhone, because as does Apple, so do the merchants. Verizon was pushing for the ISIS system which was finally launched, but to little fanfare. Mobile payments are a two-way street – there must be a transmitter in the mobile device and a corresponding receiver at the merchant in order for the payment to be accepted – and there must be a meeting of the collective minds, to agree on one or two standards.
The merchants want you to use their credit card or their app, that way they are in control of your information and can track what you purchase, send out coupons, and make money on the interest they charge on their cards. The other problem is educating customers and employees how to use the mobile wallets. It was hard enough to convince an older customer to simply hold their "payWave" debit card in front of a reader to make a purchase. When it come to our parents' money, they are sticklers for tradition – they even fight online banking, even though it adds so much convenience.
Until the companies can get together and create a standard, mobile wallets will continue to flounder. Google took a good first step in Android 4.4 KitKat, their newest operating system, by not requiring the security chip for NFC transactions, opening up the possibility for many new Android devices to use their Google Wallet. However, if you really want to shop conveniently and safely this Christmas, you could sit in the comfort of your home and order presents over the internet using your credit cards. Maybe next year the mobile wallets will finally start to blossom.