Contactless Payment

Moving to the Mobile Wallet for Convenience and Security

Which would you rather lose, your wallet or your mobile phone?

A survey in 2009 among mobile phone owners had 40% confess that they would rather lose their wallet then their mobile phone of choice. This was back when the iPhone 3GS was big news, and well before any mobile payment options from third parties like Apple or Google, or mobile payment apps developed by the banks themselves. Only about 32% of Americans had one of these cutting edge, and also expensive, devices.

When the first smartphones were introduced, they were more than just phones. They gave us access to our email, calendars, the web, and made instant messaging so much easier. We could communicate wherever we were. As device specs grew, our devices broke our expectations when it came to games and entertainment. For most of us, our wallet and our mobile device are side by side each and every day.  Never leaving our sides.

But mobile penetration has nearly doubled in the last four years – 68% of Americans own a smartphone. If you asked a mobile phone owner today, it’s a safe bet that more than 40% would say they’d rather lose their wallet.

Of course, as we transition to the world of digital payments, pretty soon we won’t have to carry our wallet at all.

From a purely physical standpoint, our mobile phones are probably more secure than our wallets, because we handle them all the time and, in the interests of privacy, have tools to lock down the device or locate it when it goes missing. Wallets, filled with personally identifying information and numbers debit and credit cards, aren’t so fortunate. We may rarely carry money anymore but the cards, especially ones that aren’t EMV cards, will be used almost immediately for fraud.

As companies move towards mobile payment systems – whether through services like ApplePay or direct issuer applications that let you pay direct with the phone or ATMs that use your mobile phone instead of a debit card – powerful encryption is needed to be in place to ensure the wireless transfer can’t be pirated.

While vendors can’t ensure you don’t lose your mobile phone, they can make sure that the transaction is secure – and authorized. Mobile phones come with many sensors built in to power the features users rely on. But those same sensors can also be harnessed in ways that can verify if the person that’s using the device is the person who is authorized to use it. So not only can you track typing speed/cadence and how a human interacts with a website, you get even more metrics, like how you hold a phone, how hard you type, or if you’re moving when you do it.

Mobile phones are in a unique position of being able to help build a better, deeper picture of the human behind the device. More than that, all this data is anonymous and useless to hackers. Unlike a stolen credit card, Social Security Number, or fingerprint, which can then be used to identify the person, how fast you type and how hard you press the buttons can’t be leveraged elsewhere. By relying on a deeper authentication layer, you devalue the data hackers love to hunt for – making data breaches a thing of the past.

The mobile wallet will change everything from how you buy a cup of coffee to how you conduct your banking and will make it easier for everyone except fraudsters.