Our smartphones are poised to play a key role in the evolution of our money – specifically, how we pay for goods and services in the future. Mobile banking is being introduced not only as the easiest and safest way to shop, but as a replacement to the cards you carry in your wallet. The idea is that only one device will be needed in the future in order to pay bills, make purchases, cash in loyalty points, and even use coupons – and that’s your mobile.
Two of the main players in mobile banking are Google Wallet and Isis. These two companies are banking on a future wallet-less world where consumers can simply wave their smartphone in front of payment terminals to complete transactions, with money deducted directly from linked bank accounts or credit cards.
Sounds pretty convenient, right? As with all new technological advances, though, there are some cons. Here’s what consumers should know.
It’ll Be Easier To Manage Your Accounts
By using your smartphone, you will be able to access account details for your credit lines, credit cards, mortgages and loans. You’ll also be able to view your transaction history, transfer funds and send email money transfers.
You Can Pay Friends Back Right Away
Splitting a bill with mobile banking will never be easier. If you owe someone money, you will be able to send them cash from your bank account immediately into theirs. No need to carry exact cash or even visit a bank machine.
The Easy Way To Update And Pay Bills
After setting your bank account in your mobile phone, you will be able to pay bills and update payment information immediately at any time and from anywhere. This eliminates logging on to your bank website to make payments to any company.
Stop Clipping and Start Scanning
Mobile coupons will mean you will never forget those pesky little paper squares clipped from the paper at home – trusted you remember your smartphone! Each coupon will be scanned and held in your mobile device for you to use at the store. To get the discount you will scan your code to take advantage of the deal in store.
You May Experience International Challenges
Travelers might find it hard to find retailers in other countries that will accept their mobile payments. As well, the need for cash or plastic will probably still be needed at smaller shops that are slower to adopt the new form of payments. Retailers might find the new system expensive to set up and that cost might be downloaded onto the customer.
What If You Lose Your Phone?
Using your mobile as a central way to pay could land you could be in a bad situation should you leave your phone at home. Fortunately, there are safeguards in place should your phone be lost, or worse, stolen. For example, Google Wallet requires all transactions be preceded by a pin, and the app can be disabled remotely in a worst case scenario. Enabling your phone screen lock (and thereby another pin) can add an additional layer of security.
Shopaholics Beware Of Easy Access
Mobile banking could be dangerous for anyone that might already find it hard to stick to a budget. By taking out the act of using your wallet to pay for items, consumers vulnerable to overspending may find it hard to control there retail urges. It’s important for anyone using mobile banking to set limits and assess if they will be able to use this convenience responsibility.
Adapting To Evolving Technology
It’s natural that some may balk at these changing transaction fundamentals. For example, when Pay Pass was first introduced, it was difficult for some consumers to understand charging items to their credit card without signing for it first. A few years later, and Pay Pass has become one of the most convenient ways to shop, especially for smaller items like coffee or fast food.
Debit is now getting in on the tap-and-go game with Interact Flash entering the market. This will enable debit card use, without entering your pin code. Companies like Cineplex, Esso and McDonalds will soon be offering this technology. Keep in mind, though – what you gain in convenience could make you vulnerable to security issues. While the debit card information is protected against information scanning, and consumers are protected by Interac’s Zero Liability Policy, it’s vital that you report lost or stolen cards immediately to keep your funds safe.