While banks are closing branches and limiting the number of branches that carry cash, mints are closing down and governments are pushing for a cashless society in the Nordic countries, smartphones have turned into veritable online banking, peer-to-peer money transfer, in-store payment and shopping devices.
Many activities that previously required a visit to a bank branch or at least a computer can now be completed just as easily, if not more so, using a mobile phone. Are our wallets and credit cards the next things to go?
Especially among the younger population, splitting restaurant bills and transferring money to friends or family are often done using apps that link mobile phone numbers and bank accounts. They are easy to use and you do not need to know the recipient’s bank account number. Many of those apps have started offering in-store payment options, drastically lowering the effort required to start using mobile in-store payments. The only obstacles to widespread adoption are the already advanced banking infrastructure and modern payment systems in use in the Nordic countries.
Perceived security level is the other main problem with mobile payments, which is mostly not based on reality, especially with secure and simple authentication methods such as fingerprint readers becoming more widely available.
We expect the influx of fingerprint readers to further advance mobile payments along with the revision of the Payment Services Directive, which will open up territory previously held by banks for competition from global players such as Apple, Google, PayPal and Samsung.
Apps that link phone numbers to bank accounts and online banking apps used by about 60% people who have transferred money using their phone.
Contactless payment apps offered by banks take the top spot for in-store payments
Lack of benefits is the top reason for not using mobile payments, followed by perceptions of insecurity.
Over a third of those with fingerprint reader use it to authorize payments and money transfers.
Researching products and services, checking bank balances and browsing shopping websites are the most popular monthly e-commerce activities.