Digital wallets are considered in most tech circles as the future of real-world payment technologies. With major players like Google,Apple,PayPal and others jumping on the bandwagon and developing their own mobile-first payment technologies, a shift in consumer payment technologies is on the horizon.
The problem is, adoption has been rather slow, and until retailers start embracing the technology to process the payments, no one will be able to leverage the benefits of e-wallets to the full extent. Future is beginning to look like one that will feature the digital wallets in some capacity.
Here’s what we know:
NFC isn’t the sole option
The first phone with NFC technology was released in 2006 (Nokia) and it was billed as a game changer for mobile devices. Since that time, we’ve seen rather slow adoption of the technology and some analysts think that it’s being overtaken by other technologies.
The problem with NFC, aside from only a handful of popular phones coming equipped with it, is the fact that retailers have to change their existing POS systems in order to accommodate the newer payment technology and retailers are worst with adoption.
Luckily, NFC isn’t the only technology in town. The “big three” (Google, Apple, PayPal) in the digital wallet space, as well as a host of newer companies are all exploring digital wallets that utilize technologies outside of NFC. Wi-Fi, Bluetooth, or even QR codes are all being explored as possible options to replace NFC.
The most exciting of these technologies, is the latest iteration of Bluetooth 4.0 which compared to NFC offers more efficient use of phone battery, longer range, and a higher bit-rate for data delivery.
Security
The process of processing a digital transaction through modern encryption technology is safer and far more efficient than using an ATM machine or swiping card at the local retailer. The biggest risk isn’t that of data interception by a third-party, but instead physical loss of the device containing mobile wallet. While “turning off” the device after reporting the cards stolen should remain relatively simple, we’re not at all aware of how security protocols exist in order to protect the consumer should a thief attempt to use the card. All of this is easily preventable with a strong password or using bio-metric security devices available on some current smartphones.
Another risk involved in digital wallet adoption is one that has yet to be answered; who accepts the burden of personal liability in the unlikely event of fraud? Most credit card companies currently shoulder this risk, but this fraud insurance doesn’t exist when the card is tied to a mobile wallet.
to be contd…
Reference: https://sites.google.com/a/utexas.edu/digitalwallets/secur