GUEST WRITER: 4G is not enough to secure the future of mobile payments

In a recent interview Mastercard’s chief innovation officer hailed 4G as the answer to securing the future of mobile payments in Britain.  The launch of superfast broadband will certainly make it easier for users to quickly access the Internet and their apps but this is not enough to lure consumers away from their credit or debit cards. The app must also be easy to use. Customers don’t want to deal with endless payment walls when they try to use their phone to make purchases.  They also don’t want to be left having to type in their card details every time they pay. According to a recent survey conducted by Harris Interactive, over 51% of respondents cited that difficult checkout and transaction failure was the most common reason for failed purchases.

Not only is simplifying payment important to adoption but so is putting the customer first and knowing what they want. Most people like the way they pay for things already and aren’t looking for alternative to disrupt the process. If they are going to switch over to mobile payments they are going to want to be rewarded for doing so.  In other words, they want a reason to use a payment scheme- and finding a way to keep consumers loyal to the brands they like is essential if mobile payments have a future.

Mobile applications must therefore be able to gather data about the consumer at a personal level, process their needs and taste preferences, and then be able to give it to them instantly at the checkout counter.  This is difficult to achieve but will secure the future of mobile payments.  Imagine the business potential of offering consumers an app that knows they are “loyalty” members of different stores and can instantly have points given to them on their reward card when they make a purchase and offered an instant gratification for making a purchase at a store with the app.

The consumer doesn’t need to do anything to be rewarded-not even take out their loyalty card from their wallet. All that’s required is to pay with their app and they receive an enhanced shopping experience in return. This ‘enhanced experience’ could be provided through a gift with purchase, extra bonus points or a reduction in the price of purchase.  It’s important to remember that customer loyalty will come to those retailers who offer their consumers the right experience, not just the right rewards. There is always a competitive retailer who may decide to offer more rewards. If this is all you have to offer to shoppers then they will instantly switch loyalty to the retailer providing the most rewards.  

More than ever before mobile payments have a great future thanks to advancement in technology and its ability to support mass adoption. Consumer preferences for paying are also changing.  According to the UK Payments Council, the use of debit and credit cards will decline within eight years and the decade will be defined by mobile payments. Moving forward, the industry needs to get it right from the user experience to make sure they convert consumers into customers – and secure a viable future in the mobile payments space. 


By Hooman Mazaheri, CEO Europe at MPayMe

About the author:

Hooman Mazaheri has 25 years’ experience in business management, business development and product development within the IT sector, including 14 years in payments. Prior to MPayMe, Hooman served as board member and Director of Business Solutions at a global solutions and managed services organisation within the financial sector. He has previously launched a successful start-up within the medical sector and worked within the utilities sector.

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