More than half of consumers believe mobile wallets are less secure than cash, but nearly 60% of executives say mobile money will build their business because it is safe, according to a new report by business and IT services provider NTT DATA.
In August 2016, NTT DATA and Ingenico ePayments surveyed 2,000 global customers and 300 firms globally and found that customers in developed and developing countries are interested in using mobile money.
According to the study, companies must do more to ease customers' security concerns if adoption is to become widespread.
The report also found that consumers understand the benefits of mobile money, with 60% agreeing that mobile money enhances their purchase experience and 50% saying that mobile money drives loyalty to their financial institution or online merchant.
Meanwhile, security concerns are undermining mobile payments with around 75% of consumers saying guarantees against monetary fraud would encourage them to use mobile payments, however only 44% of businesses currently offer or plan to offer such guarantees.
Only 25% of consumers said online and mobile transactions are the safest form of transaction.
It added that most businesses continue to rely on traditional passwords and finger scans. Less than a third of firms globally currently use or plan to use biometrics like face, voice and iris recognition to secure mobile devices. Customers focused on security prefer multi-step authentication for mobile payments.
NTT DATA Consulting senior practice lead of retail banking Peter Olynick said: “Fear is a powerful inhibitor, and fraud fear is top of mind for many consumers. Consumers are not just worried about losing one or two transactions, they fear having their identity stolen. If financial institutions can mitigate those fears and improve merchant adoption for mobile, we will see consumer adoption rates begin to accelerate.”