Younger Generation Will Drive Demand for Mobile Payments
Increasingly, technology is changing what we consider possible, from unlocking a car from inside the house to recording a movie remotely. With this evolution, the mobile phone has become the most important technology accessory, with younger generations fueling this movement.
Consumers are now poised for the next step – using their smartphones as mobile wallets, according to a new survey by MasterCard Worldwide. The study, conducted by Kelton Research, shows 62 percent of Americans who use a mobile phone would be open to using their device to make purchases wherever their errands may take them.
“Consumers are already living a mobile lifestyle so using their phones to make payments on a daily basis is a natural next step,” said Mung-Ki Woo, group executive, mobile at MasterCard Worldwide. “2011 is the beginning of the NFC mobile payments era, and consumers are eager to get their hands on the first commercial deployments in the U.S.”
Defined as a mobile generation with its pulse on digital trends, 18-34 year-olds are particularly ready to take their transactions to the next level:
- According to the study, 63 percent of 18-34 year olds would be at ease using mobile phones to make purchases versus those age 35 or older (37 percent).
- Consumers ages 18-34 (65 percent) feel more naked without their phones than their wallets, compared to 34 percent of those in the 35 and older group.
In a separate 2010 survey conducted by MasterCard Advisors, respondents under 30 years of age showed this demand has also been building for the past few years. This group is increasingly hungry for mobile payment options and access to their funds:
- Between 2009 and 2010, respondents showed a 67% increase (15% in 2009 to 25% in 2010) in the number of purchases made with their mobile phones.
- In this time period, this audience also increased their daily mobile phone access to their bank’s online banking service by 79% (14% in 2009 to 25% in 2010).
Perception is Important
This growing willingness to use a mobile phone for payments supports the role mobile phones play as a reflection of personality, and consumers’ desire not to carry a traditional wallet. According to the study, consumers value mobile phones not just for the functions they can perform, but for what they say about them too. Over half (54 percent) of respondents think that someone’s phone is more telling of their personality than their wallet.
“When credit and debit cards were first introduced, consumers welcomed the improvements they made to the speed, convenience and reliability of transactions,” said Woo. “Now with the mobile wallet ready to revolutionize this experience again, consumers have even more to gain as their phones take on additional functionality and value in their lives.”
Gender Divides How Consumers Evaluate Mobile Payments
As the mobile wallet goes mainstream, gender will play a role in how it’s perceived and used. While men see their phones as functional necessities, women take a more personal approach to their mobile devices. According to the survey, men tend to be more willing to use their phones for payment transactions, and they perceive the transactions in a positive way:
- More men than women (51 percent vs. 40 percent) who have a mobile phone would be at ease using it to make purchases.
- More men than women (49 percent vs. 45 percent) would be impressed by someone who paid a bill with a mobile application than with a credit card.
While women are slightly more conservative about mobile phone purchasing decisions, they highly value the content stored on their phones:
- Women more so than men (50 percent vs. 36 percent) feel more exposed without their mobile device than their wallets.
- Of women, 45 percent (vs. 34 percent of men) would rather have their phones than their wallets surgically attached so they’d always remember them when leaving the home.
Trust and Privacy are Critical to Consumer Comfort
Despite reliance on mobile devices and general consumer readiness for mobile payments, the survey revealed that overall safety is a significant comfort factor in the decision to pay by phone. Nearly two in three respondents (62%) said they need confirmation that their personal information is safe in order to be comfortable making a transaction, underscoring trust and privacy as paramount factors in changing payment behaviors.
Survey Methodology
The MasterCard Mobile Survey was conducted by Kelton Research between April 15th and April 22nd 2011 via email invitation and an online survey. Quotas are set to ensure reliable and accurate representation of the total U.S. population ages 18 and over.
Source: Business Wire
One Response to “Younger Generation Will Drive Demand for Mobile Payments”
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Nice and time oriented article.I think it may help those who are engaged in developing such services…
I would like to develop a prepaid master card which can be operated over mobile and internet and transfer P2P..
is there anybody who can suggest me and provide me some ideas or can be a part of it…please contact me..