Mobile money is not living up to the hype and failing to deliver for consumers and merchants alike, according to research by MPayMe, the company behind the global mobile business platform ZNAP.
MPayMe claims this is because the industry is focused on payments, an area that’s not broken nor in need of being fixed.
The ZNAP consumer survey of 1,500 UK adults shows despite the plethora of mobile wallets and well over half of the UK population owning the smartphones needed to use these wallets, less than 10% of smartphone users made a point-of-sale payment.
In terms of merchants, very few are set up to accept mobile payments. ZNAP examined merchants on Oxford Street, Europe’s busiest shopping district, and found only 7.5% are able to accept mobile payments.
ZNAP believes that mobile money is failing consumers and retailers because:
- Payments only – they focus only on payments and not other forms of money and lifestyle management
- Fragmented – the solution is often restricted to a single channel, such as online or in-store, which means customers need multiple applications
- Parochial – the majority can only be used domestically, unlike most credit and debit cards
- Wallet replacement – they fail on the promise of genuinely replacing wallets due to limited functionality
- Limited scope – they are almost exclusively aimed at retailers, despite this making up only a very small fraction of the average household spend
Hooman Mazaheri, European CEO of MPayMe, said: “With one or two notable exceptions, the biggest retailers and merchants in the UK are slow in adopting this new technology. It’s a similar picture for consumers too. The products currently being offered often have too many limitations and don’t offer the value or the utility to drive merchant and consumer adoption. When there are already well-established and traditional ways to pay, i.e. cash and cards, what’s the benefit of introducing a rival if it doesn’t come with added value?
“What’s needed is a solution that addresses the real and diverse needs of merchants and consumers. Yet another method of payment isn’t enough unless it comes with add-ons such as data and loyalty scheme management for merchants, and a relevant, versatile and wider-reaching customer experience for consumers.”