The era of mobile payments and digital wallets has arrived. But has anyone noticed?

The reality is, despite exciting advances in the technology and the readiness of many businesses to accept them, mobile wallets haven’t yet made their case to a majority of consumers, who, at least for now, want to hang on to their credit cards.

The State of Mobile Payments

So what is the technology behind mobile wallets? Near-field communication (NFC) lets devices talk to each other when touched together, or even when in close proximity to each other. A customer simply has to tap their phone to the payment terminal or, in some cases, wave it in the general vicinity of the terminal.

Even though it hasn’t yet seen widespread adoption, this contactless method of payment is growing. Mobile payment use is projected to reach 76 million (33.1 percent) of smartphone users by 2020, up from 50.8 million (24.3 percent) in 2017. In addition to NFC, other mobile payment options include direct mobile billing, app-based payments, and premium SMS.

And the number of mobile payment choices continues to grow. Consumer options now include Apple Pay, Google Pay, Samsung Pay, and Chase Pay, among others.

Why should US consumers embrace mobile payments? They’re faster, more convenient, and safer than traditional credit cards. Retailers are listening, and an increasing number are offering this option.

Credit card companies have also jumped on board this trend. Capital One and American Express were early adopters, with Bank of America and Wells Fargo following close behind. Chase Visa says all of its cards will be contactless by the end of 2019.

You'll also increasingly encounter contactless on the go. New York City's subway started accepting it back in May, with DC, Chicago, and Boston on a similar path.

US Consumers Slow to Adopt Digital Wallets

Despite all of the above facts and figures, mass adoption continues to lag behind estimates, mainly because, as easy as mobile payments can be, they don’t yet offer the seamless experiences that shoppers crave. Patients want access to receipts, loyalty programs, payment history, and gift cards under one roof, and they expect their mobile payment solutions to recognize their identity and apply any appropriate discounts at checkout.

Security a Major Concern

One of the biggest hurdles businesses must overcome is the perception that mobile payments aren’t safe. In 2018, eMarketer found that 59 percent of consumers were concerned about the safety of their personal data when paying with a mobile device, and an Experian survey showed that 55 percent of consumers use credit cards to alleviate their worries about safety. And even though a quarter of shoppers have paid with an app on their phones, only 12 percent have faith that those payments will be protected.

The reality is quite different. Digital wallets protect customer data through a potent combination of encryption, authentication, and monitoring. Mobile banking is generally considered safer than online banking because of what’s known as “sandboxing architecture,” which keeps malware out of individual apps.

Brands That Have Made the Leap

Despite these reservations, there are several well-known companies that have embraced mobile payments and brought customers along with them.


The coffee giant has mobile payment adoption rates (30 percent) that blow Apple Pay out of the water (~5 percent). Why?

  • They led the way. Their mobile payment platform hit the market years before Apple and Samsung got in the game.
  • Customers liked it. In fact, customers with the app spend up to three times more than customers who don’t use the app.
  • It saves time and money. Starbucks pays less in credit card costs and can process orders faster without waiting for swipe or chip transactions.

Shake Shack

The burger behemoth credits its mobile app with the following positive sales trends:

  • Same-store sales rose 3.6 percent in early 2019, well above a predicted 0.8 percent increase.
  • Customer traffic went up by 1.6 percent.
  • Shares rose nearly 9.7 percent after the chain released these numbers.

The Way Forward

There is a bright future ahead for mobile wallets, but much work remains to get there. The mobile wallet of tomorrow requires features that consumers have come to expect, such as digital receipts, complete payment history, the ability to pay later or split payments, cash withdrawals, and rounding up for charitable giving or personal savings.

But there are outliers, industry leaders who have paved the way for mass adoption of mobile payments. Poynt’s connected payment solution accepts all manner of mobile payments (as well as credit cards and cold, hard cash).