Most Americans Expect Smartphone Payments to Replace Cards and Cash

The majority of American consumers believe it is likely that cash, credit and debit will fall behind the use of smartphone payments, according to the findings of a new Harris Poll. 66 percent believe mobile payments will beat out cards, while 61 percent believe they will overtake cash.

Only 32 percent of those who believe smartphone payments will overtake cards, however, think this will happen in less than five years, and just 26 percent of those who believe they will also overtake cash think it will happen in that time period.

Additionally, while consumers believe a change in collective purchasing habits is coming, interest level in changing their own habits varies. 27 percent of Americans and 44 percent of smartphone users report overall interest in their ability to use a smartphone to process in-person payments. Only 8 percent of Americans and 16 percent of smartphone users described themselves as "very" interested, according to the poll results.

Broken down by generation, 40 percent of Echo Boomers expressed interest in smartphone payments, as did 34 percent of Gen Xers; 18 percent of Baby Boomers; and 7 percent of Matures.

Men showed more interest in the technology at 32 percent, vs. 22 percent of women. And 38 percent of households with children showed interest vs. 22 percent of those without kids.

Security is a primary consideration, the poll revealed. 51 percent of those who are “not very interested” or “not at all interested” in smartphone payments stated that they do not want to store sensitive information on their phone, while 40 percent do not want to transmit sensitive information to a merchant's device.

Smartphone ownership is another stumbling block, with 50 percent of the uninterested reporting they are not interested because they do not own a smartphone. Finally, 52 percent of those who are not interested simply don't see a reason to switch from cash or cards.

Initiatives to seamlessly integrate smartphones into payment habits only have moderate potential, according to poll data. 28 percent of Americans and 40 percent of smartphone users indicate that the ability to make mobile payments while taking advantage of their existing credit card rewards programs would increase their interest, but only 9 percent and 15 percent, respectively, specify that they would be "much more interested." Also, only 8 percent of those who are not interested in paying with smartphones indicate such initiatives would increase their interest, and only 1 percent indicate that they would make them much more interested.

When asked about the ability to use their smartphones as a digital wallet with electronic versions of all the identifications, loyalty program cards and other documentation normally contained in a wallet, 30 percent of Americans and 43 percent of smartphone owners responded that it would make them "more interested"; only 8 percent and 12 percent, respectively, said it would make them much more interested. Meanwhile, 12 percent of those uninterested in paying with smartphones overall indicated that such initiatives would make them more interested, with just 2 percent of the uninterested indicating that it would make them much more interested.

The mobile payments industry has yet to find a similar "in" with consumers as debit cards did by responding to a genuine consumer desire, according to the poll. Giving Americans a reason to change how they pay will depend not only on new ideas enabled through technology, but also on paying attention to their current payment habits and looking for a need they may not know exists.

This Harris Poll, conducted by Harris Interactive, took place online between Nov. 14 and Nov. 19, and surveyed 2,383 adults aged 18 and up. Figures for age, sex, race/ethnicity, education, region and household income were weighted as necessary to bring them in line with actual proportions in the population.