In January, Google announced a plan to overhaul its digital wallet offerings into a single platform called Google Pay.
This is big news not only for everyday shoppers using digital wallets, but also for retailers looking to meet growing customer expectations for new ways to pay. Overall, digital wallets haven’t seen the uptake predicted a few years ago.
As of November 2017, less than a quarter of global consumers with the ability to try a digital wallet have done so. Usage typically
Regardless of some promising uptake numbers numbers, it’s obvious there are still many hurdles to clear before we see ubiquity.
There are many reasons, but in the U.S. the main pain points tend to be around security, rewards/points and the user experience. Several wallet providers, including Apple, Samsung and Google, have been working to address these concerns.
About 25% of consumers who have access to a digital wallet don’t use it because of worries over security. In response, mobile provides like Google with built-in encryption so consumers’ credit card numbers are not shared with merchants when they are paying in physical stores.
Using a digital wallet for purchases traditionally means the merchant will not be visible to the credit card company, making it difficult for customers to leverage popular rewards or points programs. About 10% of consumers don’t use digital wallets because of this. Google Pay allows consumers to still rack up rewards and points on their credit card while also using the digital wallet.
Around 40% of consumers say they are satisfied with their current payment methods. Most shoppers haven’t yet had a reason to use digital wallets because not enough value or ease of use has been added. It appears Google’s main strategy with Google Pay is to focus on delivering a seamless, high-quality experience that encourages ongoing use as a credit card alternative (or supplement).
