The ongoing power struggle between security and usability represents one of most pertinent challenges in mobile wallet today. While it is possible to build a nearly fraud-proof payment mechanism, it most certainly would not be usable.
And although a completely frictionless payment experience could be a reality, it would undoubtedly be riddled with security gaps. Making matters more challenging, as Figure 3 indicates, respondents place a high level of importance on both security and ease of use, regardless of age group.
Mobile wallet providers must make it a priority to balance these two inextricably intertwined requirements and position both at the crux of their value proposition.
Fortunately for mobile wallet providers, mobile has opened the door to significant advancements in payment security that add to – not detract from – ease of use. Among the most significant is tokenization, which creates a unique and dynamic 16-digit substitute for a cardholder’s account information and is processed without exposing sensitive data.
Tokenization – combined with features such as fingerprint biometrics, remote data-wiping capabilities and telco data used in cardholder onboarding – has positioned wallets as far superior to physical payment cards from a security standpoint.
The challenge comes in effectively communicating the benefits of these advancements to end users. Mobile wallet providers should ensure their consumer messaging communicates not only how their applications implement security features in addition to those consumers already enjoy with their physical cards (e.g., fraud protection), but also how they remove friction from the path to purchase (e.g., elimination of manual data entry for in-app checkout).
Security concerns are cited by respondents as the primary inhibitor to mobile wallet adoption. There is a strong correlation between age and perception of mobile payment security that wallet providers should be cognizant of.
As Figure 4 shows, respondents aged 25-34 have the most favourable security perception of mobile payments relative to traditional credit cards; 52% said they believe mobile payments are more secure than credit cards.
The data shows that from age 35 onward, the perception of mobile payment security declines precipitously – just 24% of respondents aged 55 and older said they believe mobile payments are more secure than traditional credit cards.
This audience will require a foundation of trust to be constructed, meaning wallet providers must place extra emphasis on their unique security attributes to change perception. But the need for better education across all age groups is apparent because an average of 25% of respondents said they simply “don’t know” when it comes to determining the security of mobile wallets in comparison to cards.
The post Mobile commerce readiness: The mobile wallet security conundrum – Pt 2 appeared first on Payments Cards & Mobile.
