PIF Insight: Will the mobile phone replace cash within five years?
Majority of UK Consumers Expect Mobile to Become Main Tool for Making Payments.
The days of carrying cash are numbered according to a new study into the habits of UK consumers, with mobile payments set to be our main form of payment within the next few years.
The Future of Mobile Payments report including a survey of 1,000 UK adults*, published by the Prepaid International Forum (PIF), the not-for-profit body for the prepaid sector, found that currently just under a quarter of adults (24%) have used their mobile phone to make payments, with 12% doing so on a regular basis.
However, the greater convenience and extra functions offered through mobile payment apps, mean that the majority of consumers under the age of 44 expect mobiles to replace cash and plastic as their main means of making payments within the next few years.
Consumers questioned in the study said that the main reasons for making the switch were being able to see real-time account and balance information (47% of consumers), as well as the greater convenience of being able to carry just their phone (39%).
Only older consumers are resisting the lure of mobile payments. While 49% of 18 to 24 year olds have used mobile payments, this figure plummets to 12% of over 55s and just 5% of over 65s. However, over 25% of those questioned already use their mobile to make payments, with highest usage in Northern Ireland at 33% and Yorkshire and the North West with 29%. London follows a close 3rd at 28%.
Alastair Graham, spokesperson for PIF, says:
“The innovation in mobile payments has led to many consumers using their mobile phone to pay – we see daily use in public transport and in coffee shops, for example.
“While uptake to date has been steady, many people are gaining confidence in mobile payments and like the convenience and extra functions that come as part of the package.
“Retailers are encouraging usage with discounts and special deals, and innovations such as immediate peer-to-peer money transfers are opening people’s eyes to the potential improvements to how they currently manage their cash.
“We’re all used to the triple-check for keys, phone and wallet before we leave the house. By making that just a double-check, mobile phones are looking a good bet to win the day - especially with younger consumers who feel less loyalty to the plastic cards in their wallet.”
According to Andrea Dunlop, CEO of Card Solutions & Acquiring at Paysafe Group:
“At Paysafe the biggest change we have seen in recent years is with the Millennials. They completely differ from previous generations in the way they make payments and the communication channels they prefer. They are much more likely to consider non-traditional payment companies, and see value in convenient mobile and prepaid payment solutions.”
To learn more about PIF visit www.prepaidforum.org