Why mobile wallet has yet to see an uptake?

by Sharon Lobo    Jul 30, 2013

Mobile Wallet

We live in times where we are so attached to our gadgets that they have become critical to our existence, with Smartphones being the critical of the lot. With thousands of apps available for every need you could think of, Smartphones have become an integral part of our life. We might forget to carry a wallet but not our Smartphones. But here a question arises. If Smartphones are pretty much capable of doing so many tasks, why can’t it act as a wallet?

It would be so convenient if a mobile wallet could enable you pay bills at restaurants or at grocery stores, buy tickets on the public transport system or at cinema halls. While there have been innovations on this front, it will take a long time before the system is perfected.

Smartphone manufacturers have for some time toyed with the idea of a mobile wallet. For instance, Apple launched Passbook, which could store boarding passes, movie tickets, loyalty cards and gift cards on the users’ iPhone and that’s just it. On the other hand, Google worked with major credit card companies and banks to create its Wallet app that enabled Android users to pay for items at some stores by waving their phones. However, the concept has yet see a mass adoption.

According to analyst, the mobile wallet idea has yet to witness considerable uptake simply because paying via a mobile phone is not that easy yet. For one there are technological issues that need to be addressed including poor network connectivity, low battery and other technological issues that exist. Also, there are so many stake holders involved such as banks, credit card companies, mobile wallet solution providers, network operators etc, thereby making it tough to decide who shares what percentage of the profit.

In India, however, there are a few retailers who have implemented an e-money solution. For instance, PVR cinemas for instance has launched an NFC enabled PVR Wallet’ app for the BlackBerry 10 platform. The solution provided by NEC enables moviegoers to ‘tap & pay’ for movie tickets and refreshments without using paper money across 15 PVR cinemas in cities like Delhi & NCR, Chennai, Mumbai, Chandigarh, Pune, Hyderabad, and Bangalore.

Speaking exclusive to CXOtoday at the implementation, Zubair Alam, Country Head, NEC India said, “The reason PVR went for an NFC solution was the speed it provided. It enabled the transaction to complete in 30 seconds, whereas earlier it would take up to 3 minutes. This enabled PVR to earn up to 5 times more revenue in the same amount of time.”

However, Zubair, further put forth his concern that in today’s challenging economic scenario, business were skeptical in implementing such new solutions due to the cost involve. So unless businesses were absolutely sure of the ROI only then they would invest than being trailblazers.