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Shoppers are using a wider variety of payment options with digital and mobile payments serving as supplements to the traditional cash and card-based payments tools, according to a survey of more than 1,000 American consumers, which was released by Blackhawk Network.
Cash, checks, cards are still the most used payment methods with select digital offerings close behind–93 percent of shoppers used cash, while 68 percent used debit cards, 68 percent used checks, 67 percent used credit cards and 62 percent used PayPal.
The research also revealed nearly half (48 percent) used retailer gift cards; 45 percent used Visa or MasterCard gift cards; 33 percent used prepaid debit cards, and 14 percent made mobile payments on smartphones or tablets.
“I believe security is a concern for consumers, however, our research indicates burgeoning interest in these categories, which shows consumers are still being won over by the potential for convenience that digital and mobile payments offer,” Teri Llach, chief marketing officer at Blackhawk Network, told eWEEK.
More than two-thirds (68 percent) of mobile payment users report that they are using the alternative payment methods more than last year, with cash and checks seeing the greatest declines in use overall.
The vast majority (87 percent) of consumers surveyed think merchant-specific gift cards are convenient to use, even higher than bank-connected debit cards (82 percent).
Additionally, gift cards are now mainstream payment methods with almost half of consumers (48 percent) using them in the last year. Mobile wallets are now used by 25 percent of smartphone owners, with 64 percent of users carrying debit cards in their mobile wallets, while 58 percent have credit cards and 45 percent have gift cards.
“With all the talk of contactless, mobile and Apple Pay [payments] it’s important to take note that the use of physical payments isn’t going away any time soon, even as interest in and usage of new payment methods grows,” Llach noted. “We found that consumers want convenience and a mix of options when it comes to paying.”
When asked to select the most convenient payment methods, consumers selected cash (93 percent); credit cards (92 percent); PayPal (90 percent), and retailer-specific gift cards (87 percent). Ranking most inconvenient were bitcoin and checks.
“In order to increase adoption, it will be important to enhance the mobile wallet experience. A physical wallet has the potential to connect all relevant payment, loyalty, coupon and deal-finding tools,” Llach said. “Mobile wallets that focus only on making credit cards or debit cards mobile are missing some value; those cards are easy for consumers to carry in their wallets every day.”
What consumers find difficult about payments, she noted, is tracking coupons, gift cards and rewards for easy redemption, tracking loyalty programs, budgeting, categorizing spending and even saving.