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Just 16% of consumers use mobile wallets for in-store payments
A new study highlights the slow adoption of mobile wallets by consumers and retailers alike, while a new device for the iPhone enables users to pay with their phone via any magnetic card reader.
Some 67% of Americans now own a smartphone, but few use them as mobile wallets to make in-store payments, according to a new study released by the Yankee Group.
In the last three month, just 16% of mobile phone owners have used their device to make a payment in-store. Despite billions in investment adoption of mobile payment technologies has been low, says Jordan McKee, Yankee Group analyst and author of the report.
Even among those using mobile wallets almost three quarters (73%) aren't using them very frequently - fewer than five times per month. Among the players in the mobile wallet market, PayPal is the most-used, by 15% of mobile wallet users - four times as many as used its closest competitor, Google Wallet.
However, it's early days. According to McKee, the majority of mobile owners are interested in mobile wallets. "With fully two-thirds of consumers remaining interested, it's important to recognize that the mobile wallet is far more of a latent opportunity than a pipe dream," he said.
One reason for the slow adoption of mobile wallets is that many retailers do not have the relevant technology to process such payments. However, a new device from Boston-based mobile wallet start-up Loop enables iPhone users to pay with their phone via any magnetic card reader.
According to MacRumors, the Loop Fob "uses 'Magnetic Secure Transmission' to create a small magnetic field via an inductive loop. That magnetic field is detected by the read head of a traditional swipe credit card reader, fooling the device into thinking a normal credit card has been swiped".
Loop is currently developing an iPhone case that incorporates the same functionality negating the need for users to have a detachable device.
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