Only used mobile phones for calls and text messages. Nobody thinks that they can use a phone to turn on a light or unlock a door. Indeed, few consumers can imagine using their phones to take photos, record videos, or watch their favorite films. Phones are used for literally everything from keys to TVs and cameras. If this is the crisis, why would we delay replacing traditional wallets, debit, and credit cards with mobile wallets?

 

It is clear that the popularity of mobile wallets as a means of payment is slowly increasing, but cash is still essential in consumers' lives. Experts from various sectors, including online banking, believe that mobile payments will soon replace traditional wallets. Recent studies show that consumer awareness has increased the use of mobile payments.

 

Successful mobile payment services include Alipay, Wechat pay, Apple pay, Amazon pay, and Android pay. This success is due to mobile payment security, consumer awareness, and the fact that it can use cash transactions and retail purchases. However, there are still challenges in integrating mobile payment methods, such as consumer perception.

 

The opportunities and challenges of integrating mobile payment means are discussed in more detail below.

 

Opportunities

 

| Rural areas

 

Rural areas will always have a significant influence on the overall economic development of a country. In these same peripheral areas, most people do not have bank accounts. With mobile banking, people can easily open bank accounts without physically going to a bank branch. Mobile wallets will also bring transparency to businesses in rural areas. The increasing use of mobile phones and the internet in rural areas will eventually pave the way for better digital payment solutions.

 

| Payment and loyalty

 

The majority of households in the US have joined more than 15 loyalty programs but participate in fewer than eight. Research shows that most consumers are reluctant to use a loyalty program unless it includes a smartphone app. Overall, 69% of people said they would always use their loyalty card if it were on their phone.

 

The secret to using mobile payments is loyalty, not price. Consumers are more loyal to brands they are dedicated to. Companies can engage consumers by offering discounts and rewards through mobile wallets.

 

| Increasing smartphone ownership

 

Until recently, research showed that smartphone ownership is on the rise. Four in ten people now own a smartphone. This number will rise as more and more people own smartphones. As the number of smartphone owners grows, so will the number of mobile payment users. Consumers will only be able to use their smartphones to make mobile payments, so it will not work if they do not have a smartphone.

 

| The growing interest in mobile payments among smartphone owners

 

More smartphone owners understand cash payments and are more interested in them than before. It is reflected in a younger and more technologically aware population. According to a Federal Reserve survey, three out of ten people would be willing to use cash payments if given a chance.

 

More and more people now have shopping apps on their phones. They check prices, research products, buy goods, and check coupons. It shows that price tags and detailed information increase the satisfaction of the mobile consumer. Most of these consumers would be interested in using a mobile wallet instead of a credit card.

 

Mobile banking and an Ingenious app for mobile payments

 

More and more banks are now allowing mobile banking services to their customers. Many mobile phone owners use this service to transfer money from one account to another, check their balance and recent transactions. The service acts as a catalyst to increase the use of cash payments. Financial institutions have also developed innovative applications for mobile transfers.

Remote mobile payment deposit is one of the most popular applications. Consumers can quickly deposit their cheques by taking a cheque picture and sending it electronically to the bank. 

 

Mobile remote deposit is one of the applications that is becoming increasingly popular. Through the application, consumers can quickly deposit their cheques by taking a cheque picture and sending it electronically to the bank. It promotes efficiency and convenience for the bank and the consumer. Satisfied consumers of mobile banking will be more likely to switch to mobile wallets than others.

 

Challenges

| Regulatory compliance

 

All mobile payment services must comply with regulatory requirements. It includes financial and consumer regulations and can be a problem for new entrants looking to invest in a new market.

 

| Risk of fraud

 

This is one of the primary reasons why most consumers hesitate to use mobile payment methods. There are significant unknown risks and fraud associated with contactless payments, such as data leakage, hacking, undetected malware, and vulnerabilities in e-wallets. They are making the technology safe for all consumers to prevent potential financial breaches.

 

| Low perception

 

Consumers still think mobile wallets don't solve anything. They are still not aware of the benefits of using mobile wallets over cash or credit cards. Therefore, most of them still use credit and debit cards for online payments and purchases of expensive goods.

 

| Low trust in mobile wallets

 

Consumers say the idea of using mobile wallets is good but not feasible. They feel they give up a lot of control when using mobile wallets. A survey by YouGov found that 43% of mobile users do not trust mobile wallets, and 38% fear not being able to pay if they lose their phone.

 

Another Experian survey found that 55% of consumers feel safer using credit cards. An Auriemma survey found that consumers who use mobile payment methods are unlikely to recommend them to their friends or family.

 

| No rewards

 

Unlike cards and cashback programs, no rewards are offered when using mobile wallets. People who use credit and cash can get discounts, tips, and coupons. Financial marketers who want to encourage mobile wallets should see this as an opportunity to get more consumers.

 

Conclusion

 

The quantity of internet users is growing every year. It estimates that there will be 650 million internet users by 2020. More digitally savvy consumers are open to innovations and prefer to use digital money. Recently, many technology companies have emerged to help turn mobile wallets into a complete financial management tool. Much remains to be done to make digital payments on mobile phones a reality. Many mobile app development agencies are helping to develop digital payment apps. The demand for a convenient payment method will continue to grow and stimulate the use of mobile wallets. If you are looking for a developer there are many app development companies that can help in building a mobile app according to your needs.