PAYMENT SYSTEMS: Digital Wallets Slow to Open

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PAYMENT SYSTEMS: Digital Wallets Slow to Open

01/01/2015

Before they commit to mobile payment systems, most retailers are waiting to see which ones emerge as marketplace winners.

Only 6.1 percent of the companies responding to an exclusive Retail Leader survey accept mobile payment systems, or "digital wallets," but many of the others are taking a wait-and-see attitude.

All of the respondents accept credit cards, and 10.2 percent report accepting PayPal. Among the majority who do not take mobile payments, the most popular reason, at 56.7 percent, was "waiting for one or more systems to become dominant in the marketplace." In addition, three quarters of those who don't take mobile payments are keeping an eye on developments and may do so in the future.

Credit card security breaches have been garnering retailers a lot of negative attention lately, and cybersecurity was on the minds of respondents. On a scale of 1 to 10, with 10 being "extremely concerned," the average level of concern about security was 7.1. More than half reported extra staff training on security issues and installing new security software.

Of more conventional forms of payment, 75.5 percent said they take personal checks. All took the three major credit cards (MasterCard, Discover, Visa), and 89.9 took American Express.

The question on business conditions revealed more pessimism than a few months ago. Only 42.2 percent described them as positive, compared with 63.3 percent in our September-October issue. The question was asked while the stock market was in the midst of a major downturn.

Among merchants who don't accept mobile payments now...

Reasons merchants don't accept mobile payments:
(multiple responses permitted)

Waiting for one or more systems to become dominant 56.7%
It would require an investment 43.3%
Customers don't want or expect it 40.0%
Concerned about data security 20.0%
Think the tech is unproven/uncertain 16.7%

Actions companies have taken for payment security:
(multiple responses permitted)

Trained employees to be more vigilant 70.6%
Installed new security software 58.8%
Removed data access points from system 47.1%
Designated individual(s) responsible for cybersecurity 47.1%
Hired an outside security consultant 29.4%

How would you describe current business conditions?
Where do you expect to see business conditions for the next six months?