Data Privacy Concerns Hinder Mobile Payment Adoption
People who are not planning to use their phone to make in-store holiday purchases are concerned about payment fraud, data privacy and identity theft.Identity theft, payment fraud and data privacy concerns remain the biggest barriers to mass adoption of mobile payment services, according to an Inside Secure survey of 1,217 American consumers. The survey revealed that 17 percent of respondents who did not make holiday purchases with their mobile phone last year, plan to use a payment service such as Apple Pay, Android Pay, Samsung Pay or a proprietary service from their bank or card issuer to make the leap to mobile payments this holiday season. The research reveals growth in the popularity of mobile payment services this holiday season, but people who are not planning to use their phone to make in-store holiday purchases are more concerned about payment fraud, data privacy and identity theft than those using their mobile device this holiday season. "The payment industry needs to engage in awareness and education. As our survey results show, security issues are by far the primary impediment to adoption," Trevor Daughney, executive vice president of Inside Secure USA, told eWEEK. "To overcome concerns, banks and other issuers offering a proprietary payment app need to message security in their lead message. They should also explain how they are handling their customers’ data, for example, are they keeping payment data separate the other data on the mobile device, and are they storing it on the device?"
Seventy percent of people who are not planning to use their smartphone to make in-store holiday purchases state that their concerns about identity theft prevent them from using in-store mobile payment applications.