Tech companies are forever hoping to replace our wallets and purses with e-wallets or mobile payments made through our phones.
But if you’re reading this, you probably still have a leather pouch stuffed full of credit cards and cash, and you’ll be carrying it for a long time to come.
Only 11% of Americans have ever tried using a mobile wallet, according to Forrester. Mobile transactions are only 2% of all transactions. If you’re not using Google Wallet, Apple’s Passbook, Coin or Clinkle, don’t worry — no one else is either.
To tech entrepreneurs, it seems like an industry ripe for disruption: Why carry around a phone and a wallet when the phone can so easily perform the functions of both? Yet the number of companies that have failed to persuade us to ditch cash and credit cards is formidable.
The New York Times recently ran a deep-dive story on eBay’s attempts to get everyone on the mobile payments bandwagon — via PayPal, Braintree and Venmo — and it buried this quote from Sucharita Mulpuru, a vice president with Forrester Research, who specialises in e-commerce and mobile payments. It sums everything up in a nutshell:
“Digital wallets, at this point in time, are solutions looking for problems. We don’t fundamentally have friction in payments in the U.S. People who want to use cash are using cash for a reason: They prefer to or they don’t want to be traced. As for credit cards, there is not something fundamentally inconvenient about them. They’re fast, they’re reliable, our networks are good.”
It brings to mind one of the fundamental aspects of the tech business, the difference between supplying a must-have need and a nice-to-have need: “It is possible to sell soda in the desert (nice to have), but it is much easier to sell water (must have).”
Right now, mobile payments fall into the “soda in the desert” category.