If you have made a payment at retail with your smartphone and are anything like me, you’ll feel this is the future of payments. But as the famous quote from William Gibson says, “the future is here. It is just not evenly distributed.” After conducting some research in the US, UK, and Australia, it would be hard to find a more appropriate phrase for mobile contactless payments.
Last fall, the United States went through a drastic disturbance in consumer retail stores thanks to the EMV shift, which moved us from swiping our credit cards to inserting them into a terminal and waiting for the transaction to complete. With the average transaction time still taking between 5-10 seconds, down from 15 seconds six to eight months ago, US consumers have had friction added to their checkout process. It is with this retail experience in mind we were hopeful, last fall, that mobile contactless payments would take off. Toward the end of 2015, roughly 17% of iPhone owners had used Apple Pay, and 7% of Android owners had used Android Pay. Part of this had to do with less than 50% of the iPhone installed base in these markets having devices that are Apple Pay capable. An even smaller number of Android-based devices in use are NFC capable. Here we are a year later, with exponentially more smartphones in the market NFC capable, and interestingly, not a lot has changed.