Do wearables and digital wallets spell the end of the credit card as we know it?
Wearable payment technology and digital wallets are the coolest new trend in the banking world - but does it really have the power to replace something as everyday and useful as your credit card? According to MyState Bank it’s more likely than you might think.
Although digital wallets have technically been around since the 1990’s, recent innovative versions including Apple Pay, Samsung Pay, Google Pay, FitBit Pay and Garmin Pay started really making a splash in the Aussie market a few years ago, with banks big and small jumping on the trend.
Now, MyState Bank has predicted a big take up of digital wallet technology in the coming years.
“We expect a 200% increase in customers using digital wallets by 2020 and these services could easily overtake the use of credit cards by 2022,” said MyState Bank CEO, Melos Sulicich.
MyState Bank recently added Garmin Pay and FitBit pay to it’s payment technology options, alongside Apple Pay, Samsung Pay and Google Pay.
Although MyState Bank said digital wallets are ‘simple’ and ‘secure’, it also said security concerns are still the biggest obstacle for Aussies picking up this new technology in droves.
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Mozo Data Manager Peter Marshall wasn’t so optimistic about the chances of digital wallet technology overtaking plastic, and agreed that security concerns could be one thing holding spenders back.
“I think we could see a drop in the use of debit cards, but I think it’s going to be a long time before plastic is phased out completely,” he said.
“One reason for that is habit - people are used to using a plastic card when paying. But I do think security concerns play into it as well. Credit cards in general have pretty robust security measures and dedicated fraud prevention programs. If a digital wallet appears as a chink in your financial armour, it’s definitely enough to make you think twice.”
Most digital wallets do have security measures in place to keep Aussies details safe, for example, on the Garmin Pay website, it states that “Garmin Pay protects you by using watch-specific card numbers and transaction codes every time you make a purchase. And your card number is not stored on your device, on our servers or passed to merchants when you pay.”
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