NEW YORK December 22, 2017
In both the US and the UK, a growing ecosystem of mobile pay providers hope to become consumers’ go-to payment method at checkout. But the future of mobile payments appears more positive across the pond, where contactless payment technology has made familiarity with tapping at the point of sale more prominent. Auriemma Consulting Group recently conducted a parallel study among cardholders in both the US and UK markets, aimed at learning about mobile payment adoption, satisfaction, and how comfort with contactless technology could impact mobile payments moving forward.
A small but notable proportion of credit cardholders (‘cardholders’) in both geographies have adopted mobile payments. While UK cardholders are slightly more likely than their US counterparts to have used Apple Pay (12% vs. 9%) and Visa Checkout (9% vs. 6%) within the past month, other options, such as PayPal In-Store Checkout (5% each) and Android Pay (4% each) show similar usage patterns. Although usage metrics are low, satisfaction with each technology is extremely high.
Over 90% of users in both geographies say they are satisfied with their mobile payment app. However, while it may be true that satisfied users are more likely to continue using than dissatisfied ones, user satisfaction alone does nothing to introduce non-users to the technology. UK consumers have a slight advantage in this area, given their introduction to contactless payment technology has familiarized them with tapping at checkout.
“UK consumers were introduced to contactless payments in 2007,” says Jaclyn Holmes, the Director of Auriemma’s Payment Insights. “Their increased comfort with this technology, in the decade since its inception, makes payment behavior at the point of sale less of a barrier for mobile pay adoption. If anything, paying with a tap has become more natural for this population than their US counterparts, who only recently began the move from swipe to dip.”
While exposure to contactless payments may increase comfort with mobile wallets, the shift from brick-and-mortar to online shopping creates an opportunity for mobile payments to grow. Most US and UK cardholders have made an online purchase on their smartphone, but a notable minority (31% and 40%) have not. And there is a link between comfort with making an online purchase via a smartphone and usage of mobile wallets more generally. Notable proportions of US and UK cardholders who have made online smartphone purchases have ever tried mobile wallets (33% and 43%, respectively). This is in stark comparison to their less smartphone-friendly counterparts, who are much less likely to have used a mobile wallet (7% and 5%).
“Cardholders who are more accustomed to shopping on their smartphone are more likely to pay with their smartphone in-store, especially in the UK,” says Holmes. “The US may have had the advantage of earlier exposure to mobile wallets, but the UK’s history with contactless has made the locale ripe for adopting a variety of mobile payment options. Increased familiarity with contactless payment technology and comfort with the smartphone as a payment device will be necessary to encourage the growth of mobile payments.”
These studies were conducted online within the US and UK by an independent field service provider on behalf of Auriemma Consulting Group. The UK study (Cardbeat UK) was fielded in August 2017 among 500 adult credit cardholders and the US study (The Payments Report) was fielded June/July 2017 among 800 debit cardholders, of which 567 were also credit cardholders. The number of interviews completed for both is sufficient to allow for statistical significance testing among sub-groups at the 95% confidence level ±5%, unless otherwise noted. The purpose of the research was not disclosed, nor did respondents know the criteria for qualifying. The average interview length was 20 minutes.
About Auriemma Consulting Group
Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space. We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines. Founded in 1984, Auriemma has grown from a one-man shop to a nearly 50-person firm with offices in New York and London. For more information, visit Auriemma’s website at http://www.acg.net or contact Jaclyn Holmes at (212) 323-7000.
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