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The Balance Between Convenience and Security in Mobile Payments

The Balance Between Convenience and Security in Mobile Payments

Let’s be honest with ourselves for a moment here. How often do you read the privacy statements for any of the multitude of things you sign up for online? OK, there are probably some out there who do, but I am pretty sure most of us mere mortals just click through the privacy statement and terms and conditions (Ts & Cs) websites and apps share with us to protect themselves.

There are a host of reasons why people don’t read Ts & Cs and privacy statements: First of all, so many of these “documents” are written in such legalese that most people would have a difficult time reading the entire document and understanding the salient points that apply to them. Furthermore, we are registering on a site or downloading an app because we have something to do, and stopping to wade through a privacy statement takes us away from the task at hand.

Instead, we simply put our trust in the provider not to do anything untoward with our personal data or our money.  We say to ourselves “lots of people use this app, what could go wrong?” Or perhaps, “my friends use it” or maybe deflect the liability of a breach on the merchant, app creator, website, or even a card issuer/bank. Others are simply rolling the dice and hoping nothing happens.

A recent study by Money Crashers reported that only 19% of the consumers they surveyed read the privacy policies on payment apps like Venmo and Zelle.  For all the reasons stated above, I can’t say I am really all that surprised.

In the same article, they say that 52% are not concerned about the security of payment apps:

Mobile payment apps have introduced a convenience like no other. If you forget your wallet, paying for your bill is as easy as swiping your smartphone or smartwatch. But while many people have been quick to adopt this new way of payment, not all have looked into what kind of data they’re disclosing by using it.

In fact, our survey found that 52% of respondents weren’t concerned about the security of the payment apps they use.

This addresses another reason important reason people don’t slog through the privacy statements and Ts & Cs, convenience. Since the dawn of the internet, users have had to make that Faustian bargain in their minds – privacy and security for convenience. For many, many people these days, convenience wins out over security. Rightly or wrongly, this internal bargaining leads one to develop a sense of trust in the sites and apps they use.

The future is bound to have more digital payment options available to consumers. An a big part of their success will hinge on gaining customer trust. Without it they are doomed to fail. I’m just not sure that a privacy statement is going to cut it.

Overview by Peter Reville, Director, Primary Research Services at Mercator Advisory Group

The post The Balance Between Convenience and Security in Mobile Payments appeared first on PaymentsJournal.

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