Tag: smartphone payments

Report highlights fragmentation in mobile payments

Mobile payments have been showing strong growth throughout the U.S., but this growth has not been as steady as had initially been expected. This week, the Federal Reserve Banks of Boston and Atlanta have released a new report concerning the expansion of mobile payments. The report suggests an emerging fragmentation in the mobile commerce sector that has served to derail some of the progress that has been seen in mobile payments over the past few years.

Mobile commerce shows modest growth over past two years

According to the report, entitled “U.S. Mobile Payments Landscape — Two Years Later,” the mass adoption of mobile commerce is unlikely without strong support and collaboration from multiple organizations and industries. Over the past two years, mobile payments have grown more popular but have done so under harsh criticism. Mobile commerce has been dogged by concerns regarding security and many of the issues that consumers have with mobile payments remain unresolved due to the lack of interest many companies have in this field.

Multiple approaches lead to slower growth

The report claims that the advent of mobile devices has created an effective way to create a dynamic marketplace for consumers. As mobile commerce entered the limelight, companies, particularly banks and telecommunications organizations, began teaming up to engage consumers in a new form of commerce. Various such partnerships and collaborations have formed over the past few years, with each partnership experimenting with ways to make mobile payments more attractive to consumers. This has lead to some fragmentation as the various parties focus on very particular aspects of mobile commerce.

Non-banks introduce more risk to mobile payments field

While innovation has been encouraged in mobile commerce over the past two years, this also comes with significant risks. Non-bank organizations that are getting involved in mobile payments represent the majority of the risks associated with this sector. This is due to the fact that these organizations rarely have the security experience that financial institutions have and are not held to the same laws that banks are.

The firm is hoping to take a new step into the industry that will help to promote adoption.

While many have been expecting the mobile payments revolution to have already begun, there are a number of hurdles in front of consumers, making them hesitant to adopt this new technology.

While the main selling angle has been convenience, until now, most consumers don’t find a card swipe inconvenient.

Moreover, using credit and debit cards is a process with which consumers have become quite comfortable, whereas, they are also well aware of the security and other concerns that can be related to the use of technology. Therefore, except for early adopters, many people have held off the use of mobile payments so that they can allow others to be the guinea pigs while they continue with systems that have never caused them much grief in the first place.

Pageonce is hoping to take a new focus in mobile payments by changing its name to Check.

With the new name, Check, the mobile payments company is also hoping to change its angle in order to make it more appealing for use by consumers. They have understood their competition and know that the technology has yet to be proven among consumers in the mass market. Now they have to convince people to leave their plastic cards and choose their smartphones, instead.

Check has, therefore, broadened its focus. They know that mobile payments in store will be a tremendous opportunity, but that isn’t where the industry has reached, quite yet. That said, consumers do like to pay their bills online, and so the company has recognized this and has expanded to offer this opportunity, as well.

According to the chief operating officer at Check, Steve Shultz, “When we started the company, the name Pageonce made sense.” But he added that “We were an aggregator of a person’s financial data — putting it all on one page. But we are now a different company.” While Pageonce allows users to establish ongoing mobile payments of bills, it is also able to offer transactions similar to those from PayPal where money is sent peer-to-peer.

Schultz pointed out that this mobile payments app is the only one that “combines personal finance features and payments on a mobile device.”