While many Apple observers were disappointed with the debut of the iPhone 4S this week, it’s not the lack of a near field communications (NFC) chip that’s irking Canadians.
Many consumers expected a more major update to Apple’s smartphone, and shrugged off new hardware such as the dual-core A5 processor and 8 MP camera as minor improvements that are simply playing catch-up with some Android competitors.
Lacking from the iPhone update was the NFC chip included in some Android phones such as the Nexus S. The chip allows for smartphones to be used to pay at check-out counters equipped with swipe-to-pay readers such as MasterCard’s PayPass.
But according to a poll conducted by AskingCanadians for ITBusiness.ca, most Canadians aren’t enthusiastic about paying with their smartphones anyway. When asked if they’d consider using Google Wallet when it comes to Canada, 31 per cent of Canadians said they would “never use it” and 33 per cent said “I may or may not use it.”
Only one in 10 will use it as soon as it’s available and 25 per cent could see themselves using it eventually. This AskingCanadians™ poll of 1016 respondents was conducted for ITBusiness.ca. The data was collected from September 23rd to September 25th.
While Canadians are increasingly buying up smartphones and using more of their features daily, replacing their wallet with their device doesn’t seem to appeal to many. Although many carry a smartphone with them everywhere they go, and it may be more convenient as a payment method in som
e situations, it seems Canucks are still wary about security concerns.
When asked “When you consider using your smartphone to pay for items in this way, what issue gives you the most concern?” overwhelmingly, Canadians said they didn’t trust the security of the NFC chip payment system, with four out of 10 saying this. Another 27 per cent said they “already have enough ways to pay for things” and 17 per cent are “worried about losing my phone.”
Any time technology has offered a new way to manage money, consumers are wary. Online banking has only in recent years really taken off as being used among a majority of Canadians, and online payment systems such as PayPal have also seen steady growth. Despite initial security concerns, the convenience offered by these tech-enhanced payment methods eventually won over consumers and security concerns subsided.
Google is aware of the need for security in its Wallet app and NFC-enabled phones. In a recent interview with ITBusiness.ca, Google Wallet engineer Rob von Behren argued that in some ways, smartphones offer a safer way to pay than your wallet.
Consider if your wallet was stolen, you’d have no means to prevent the cash in it from being used or the credit cards from being swiped before you had a chance to cancel them. But if your smartphone is stolen, the Wallet app is still protected with a PIN code to prevent anyone from using it as a payment device. The NFC chip also won’t activate unless it is being powered by the device, so there is no way a crook could remove the battery and still swipe the phone to pay.
Canadians may be more incented to use apps like Google Wallet when the payment method is tied to coupon incentives. The true convenience of smartphone payments is that loyalty programs could automatically be tied to the payment account and triggered when the right purchases are made. That means less cards to carry around in a wallet and less fumbling for the right card to swipe at the cash.
It’s just a matter of time before convenience trumps the wariness of Canadians for mobile payments, but that’s also assuming there’s no major security problems with the payment method as it rolls out into the field.
AskingCanadians™ is a full-service online data collection firm dedicated to helping market researchers gather high quality information from Canadian consumers. We own and manage the AskingCanadians™ online research community, and its French counterpart Qu’en pensez vousMC, which includes a panel of more than 160,000 demographically representative and profiled Canadians who have opted-in to participate in online surveys that significantly influence today’s leading brands.