Awareness of mobile phone payments among North American consumers increased four percentage points from last year to 56% in 2016, but its regular usage remained flat at 19%, according to a new report from Accenture.
The consultancy, which surveyed over 4,000 smartphone users in the US and Canada, found that 60% of consumers in North America use cash at least weekly to make purchases at a merchant location, down seven percentage points from 2015. Even with the decline in cash use, cash and plastic continue to be the most common payment methods.
Consumers’ use of debit cards for payments in merchant locations remained consistent at 58%, while credit card usage rose by three percentage points from the previous year to 53% in 2016, according to the report.
Robert Flynn, managing director of Accenture Payments in North America, said: “We are seeing a gradual increase in consumer awareness of mobile phone payments options; however, adoption has remained flat over the past few years. Consumers are content to use cash and plastic for their everyday transactions, and while the use of cash is declining overall, it is the most commonly used form of payment – and consumers expect it to remain so in 2020.
“To shift consumers’ payment behaviors will take more than just providing another ‘me too’ mobile payments option; leading merchants will identify and provide next-generation, value-added services,” Flynn opined.
The study revealed that consumers’ use of PayPal since 2014 has increased four percentage points to 18% in 2016.
Respondents expressed optimism about mobile wallet adoption in the future. They expect a nearly 60% rise in the use of mobile wallets by card networks (from 14% in 2016 to 22% in 2020) and tech giants (from 13% to 21% in 2020).
Of the nearly two-thirds (64%) of consumers who have never used their mobile phone as a payment vehicle at a merchant location, more than one-third (37%) said they have not done so because they believe cash and plastic are fine for their payments needs; while nearly one-in-five prefer not to register payments credentials into their mobile phone (21%) or are concerned that unauthorized transactions may happen (19%).
The study also found that nearly 73% of North America consumers trust traditional card providers the most as their mobile payments provider, followed by alternative payments providers like PayPal (63%), established retail banks (62%) and large tech companies (59%).
Of those consumers who have used mobile payments apps in store, consumers most frequently used their bank’s mobile app (26%), and 76% expressed satisfaction with this experience.