The move towards digital reflects the evolving payment preferences of Americans as well as the high cost of carrying, storing, transporting and securing physical cash. Moving stacks of banknotes through armored trucks and an intricate delivery network cost U.S. businesses $5 billion each year, according to research at Tufts University, and that figure doesn’t include the $6 billion in annual cost that merchants cough up to make ATMs available for customers.
Electronic payments make purchases fast and convenient for shoppers, but mobile wallet further raises the ante by making the entire shopping experience seamless and integrated with a cardholder’s digital account. According to a recent survey by Capital One, nearly one-fourth (24 percent) of consumers are now using mobile wallets in some capacity. Mobile wallets such as Apple Pay and Capital One Wallet, allow consumers to receive instant purchase notifications, lock their card if misplaced or lost, snap a photo of their receipts, and digitize up to 25 gift cards at one time.
The technology is seeing rapid adoption. More than 63 percent of respondents say they have only been using a mobile wallet for less than a year. However, financial experts believe that we’ll see record use of mobile wallet during Black Friday, Cyber Monday and the rest of this holiday shopping season. “More than two-thirds of wallet users told us they would use their mobile wallets even more if more merchants had the technology to allow them to pay that way,” a Capital One spokesperson tells The Huffington Post. “As wallet technology simplifies the shopping experience and becomes more readily available at retailers, the adoption and usage rates will continue to increase.”
It’s apparent that simply swiping your phone at the cashier is appealing to most consumers. Thus, non-participating merchants could tap this technology to boost their sales. The same survey finds that nearly 70 percent “of wallet users … would use their mobile wallets even more if more merchants allowed them to pay that way.” Not surprisingly, the bulk of current wallet use involve retail stores (49 percent) and groceries (41 percent) but continued success in these channels could pave the way for adoption in other outlets such as gas stations, restaurants and travel.
These days, pulling money out of your pocket is becoming less common at the checkout line. This holiday season, look around — you’re likely to see more people swiping and tapping their phones at the register.