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Payment is kicking off again.

London buses are now cashless. CaixaBank and Barclaycard have both launched contactless payment wristbands.

This begs the question – can mobile muscle in further on in-store payment and loyalty, or is the opportunity disappearing?

Contactless cards

It seems users simply don’t associate payment with their mobile phones. This isn’t necessarily the fault of many mobile wallet providers that have created slick and reliable services. It’s simply a case of ‘what’s quickest and easiest?’

The answer is contactless credit and debit cards, which will number 250m this year. Only the U.S. has summarily failed to adopt the technology.

Paying quicker makes us feel like we’re not even spending, as well as helping us get out of the queue before we receive any grief. London buses have gone cash free and already saved an enormous amount of money for TfL. Delays are reduced, operational costs come down, users have been given an emergency journey on their payment cards, to ensure nobody is left stranded.

The Caixa contactless wristband.

caixa contactless wristband

Loyalty schemes and payment

Loyalty schemes have faced difficulties of convenience when moved away from plastic. The technology of checking in via a QR code or similar simply isn’t as convenient as stamping or swiping a card.

Starbucks has had some success by combining payment with loyalty in one app. This hints at a possible role for a mobile wallet, one that is enriched with additional services.

Future of the mobile wallet

Brand app usage has been problematic for retailers. Apps seem widely accepted as a tool for customer retention and not something you can push on new customers, either at home or in-store.

Customers are obviously reluctant to download multiple apps for each place they spend money, so adding payment to brand apps is a no go, unless you’re a daily visited coffee house.

But what about mobile wallets? How can they be improved to compete with the convenience of cards?

Some think that the future of the mobile wallet is that of a combined payment, loyalty, e-receipt, ticketing function (and more). So I can pay for something, collect my receipt and reward points to a passbook, add a service of some kind to use at my discretion etc.

Of course, the problem here is how easy is consolidation? It has proved difficult enough to effectively kill off NFC, whether the consumer would have liked it or not.

If this solution was created, there’s no reason it couldn’t be used on a standalone smartwatch with contactless functionality.

Service and self-service

If convenience is everything and cash is disappearing, there’s a new tension for companies at the POS. Should businesses cut down on staff numbers and go with automated technology that customers are, on the whole, happy with. It’s an easy decision to take for many but it could come at the cost of wider customer service.

Even on buses, many rue the cutting off of the driver from the passenger through the Oyster reader and a series of automated announcements.

For many companies, commitment to staffing numbers has become less a necessity and more a philosophy.

Ben Davis

Published 9 July, 2014 by Ben Davis @ Econsultancy

Ben Davis is a senior writer at Econsultancy. He lives in Manchester. You can contact him at ben.davis@econsultancy.com, follow at @herrhuld or connect via LinkedIn.

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