Contactless trajectory

[Dave Birch] It looks as if the roll-out of contactless payment cards is not going as well as the industry had hoped. Our good friends at CPP commissioned a survey and found out that

two thirds (77 percent) of respondents are worried about card fraud, as no PIN is required for contactless purchases below £10. Other concerns include a fear of increased crime levels (48 percent) and of criminals hacking into personal details (34 percent).

[From ePaynews.com – the payment news and resource Center]

So people are scared of using contactless cards because of fraud, retailers are surcharging to cut down use and terminals are not good enough. What with one thing and another, it’s a surprise to discover that there are any contactless retail transactions in London at all. Is it therefore reasonable for James van Dyke to say that

I’m coming around on contactless.

[From Javelin Strategy and Research » Coming Around on Contactless]

I’m genuinely wondering. But is this the usual post-hype dip or has contactless just taken too long to move into the marketplace? I’ve heard more and more people — on the issuing side — talk about skipping over contactless cards completely and just moving directly to phones of one form or another, either NFC phones or phones with NFC stickers on them. The argument is, essentially, that it’s hard to deliver enough added-value to compete with the cash just using a card whereas a phone can be a platform for more services for the both the payments and retail sectors.

It really should be more straightforward. Contactless saves time…

According to MasterCard research, PayPass technology offers a 40% reduction in wait time at drive-thru and quick service restaurants and a 15-20% reduction in wait time at stores.

[From CNW Group | CAPITAL ONE | New Study: Canadians Lose Precious Time Every Day Doing Routine Transactions – Capital One Offers PayPass Contactless Technology to Help Consumers Save Time]

So why aren’t more people using it? Retailers must be forgoing some sales because of this. I’m sure, like the rest of you, that when I walk out of a shop because the line is too long the retailer must notice it. Do they?

Even more significant is the fact that nearly another quarter (24%) said that they abandon their purchases and leave the store.

[From CNW Group | CAPITAL ONE | New Study: Canadians Lose Precious Time Every Day Doing Routine Transactions – Capital One Offers PayPass Contactless Technology to Help Consumers Save Time]

I can’t help wondering why the retailer is comfortable using the wrong payment technology. In the last few days I’ve walked out of a fish and chip shop because they only took cash (and I didn’t have any and couldn’t be bothered to go to an ATM to get some: since I had to get back into the car, I just drove to another fish and chip shop — there’s plenty to choose from) and resolved never to go back to a coffee shop near one of our clients’ offices. I popped in with a client for a quick coffee: it came to four quid or something like that and since neither of us had any cash I gave the guy a card. He had a handheld dial-up terminal, so I punched in my PIN then had to wait while it dialled, authorised and printed a receipt. What a pain, when you just want to grab the coffee and have a quick review of a document before a meeting.

It gets quite frustrating: today I used my contactless card in the coffee shop here in Singapore, but when we went next door for ice cream they didn’t have contactless, so I had to get my wallet out of my bag and take out my card. Which they refused to take because the minimum payment was S$20. So we had to go to an ATM and get cash out in order to go back and get some Cherry Garcia (TM/C/whatever). It seems to me that the more places I come across where I think to myself “I wish they had a tap-and-go” the fewer places I find that actually do. The dream is some way off…

The key topic was ‘when will we know that the computer has really arrived?’. We came up with a variety of answers, but the conclusion I reached was that it would be when it enabled a true cashless society; after more discussion we decided that would be when one could go into a corner shop and buy a newspaper or a packet of chewing gum without having to use cash.

[From What do you do when the future is in everyone’s pocket? – Hot Topics – www.pcretailmag.com]

These opinions are my own (I think) and presented solely in my capacity as an interested member of the general public [posted with ecto]