Industry leaders feel that consumers will be willing to pay with their smartphones.
The mobile payments industry is working hard to encourage consumers to leave their credit cards at home and to start using their smartphones as a digital wallet, instead.
Square and other companies are already creating smartphone transaction processing products.
They are developing mobile payment point of sale transaction systems so that individuals with smartphones and tablets can use those devices to buy products and services online and from brick and mortar stores.
These companies bet that mobile payments will soon dominate the marketplace
They feel that smartphones are going to replace credit and debit cards as the most common vehicle for completing purchasing transactions. For this reason, retailers, credit card companies, and transaction processors are all pushing to move technology forward to allow consumers to conveniently and easily use mobile payments at checkout counters.
Even consumers seem keen to take part in this new method of paying for products simply by waving their phones at a reading device.
However, mobile phone manufacturers seem to be the only ones who are holding out from responding with any type of rapidity. According to Forrester Research analyst, Thomas Husson, who spoke of this mobile payments in a report, “Several inhibitors will remain, preventing the technology from reaching critical mass.”
The center of these delays is the slow implementation of near field communication (NFC) technology. Devices with this technology enabled are able to communicate through radio waves with other close devices in close proximity that also have this technology. This type of contactless mobile payment system uses the radio frequency identification (RFID) common technology that incorporates security measures into the way that it functions.
According to the Forrester report, within the next three to five years, only under a quarter of the population will have smartphones that have an NFC chip. This will hold back the number of people who will be able to use mobile payments, even if they would have been willing to do so. Last year, only 5 million of these devices were sold in all of North America.
