Back in 2014, many organizations were predicting an insurgence in mobile payments for the US and Canada – in fact, it should already be here, but it now looks as though the popularity of mobile payments may not come to Canada until 2019. This is in accordance with a recent study called, 'Business Strategy: Mobile Payments in Canada' conducted by the International Data Corporation or IDC. Robert Smythe, research associate, IDC Financial Insights says, "The transition to mobile payments will only take place when consumers see that using mobile devices for payments provides them with added value and convenience beyond plastic cards."
The US had been pushing for mobile payments for some time, and the only reason they finally took off is Apple Pay – many vendors were waiting for the iPhone to accept mobile payments before switching over even though it required them to purchase a new terminal. Android Pay was still not off the ground as it waited for Android 6.0 Marshmallow to arrive and offer mobile payments by simply using the fingerprint sensor for authorization. Now that it is arriving on smartphones it should allow mobile payments to grow even faster. Samsung Pay, perhaps, offers the best all-around mobile payment option because you can not only make mobile payments via NFC, but also MST (LoopPay) payments which will work with most old card readers where you swipe the card that many retailers still use.
Android Pay and Samsung Pay have still not made their way into Canada and Apple Pay will only use an American Express card at this point – without the means to perform a mobile purchase, there is very little chance for mobile payments to grow in Canada. Studies show that only 40-percent of the Canadian population even knows that you can make mobile payments with a smartphone – the word has to get out before customers are willing to try making a mobile payment. It does not help that Canada's SureTap (Rogers) only works with a few Android and BlackBerry 10 devices – again the equipment must be in place and easy to use. Right now for Canadians, it is easier to pull out a debit or credit card to make a purchase than the novelty of using your smartphone. Another setback is that loyalty and rewards cards are not yet tied into mobile purchases, although that day is coming.
Momentum for mobile payments will eventually grow, but as IDC says, "From the consumers' perspective, little progress has been made in enticing them with innovative mobile payment services… It will be difficult for mobile payments participants to maintain momentum, as there are currently no pressing client demands for mobile payments. Progress will result from 'push' initiatives by mobile payment providers and not 'pull' demand from consumers, at least initially until loyalty integration is firmly established." With Apple Pay adding Visa and MasterCard later this year and Samsung's announcement that Samsung Pay will be coming later this year, it is only a matter of time before the convenience, demand and pull for mobile payments will increase in Canada…but not any time soon.