by Joan Warner
I wasn’t thinking about work last night while watching Game One of the World Series. (My personal happiness depends heavily on Cleveland’s going down in flames.) But halfway through an early inning I noticed a long commercial for Masterpass, Mastercard’s mobile payment app. The ad shows people in various urgent situations—a man racing to catch a train, a woman who sees a cop about to ticket her car—saving the day with a speedy phone payment. In these vignettes, mobile money solves problems.
So I started thinking about work during the ball game, because Oxford Economics’ forthcoming research report, “The Future of Money,” looks at consumers’ relationship with cash, cards, and mobile wallets. Our global survey suggests that although people still have security concerns about mobile money, Masterpass seems likely to get a warm reception. Seventy percent of our consumer respondents said they’d like to be able to make travel, entertainment, technology, retail, and healthcare purchases with a mobile phone or tablet. A third think mobile money will dominate payments within 10 years.
Furthermore, companies may be underestimating consumers’ appetite for mobile money—and overestimating their attachment to cash. A surprising 40% of executives across multiple industries who responded to our survey think people will pay for transactions in 10 years much as they do today, with a mix of cash, cards, checks, and mobile—but only 27% of consumers agree. And while 51% of consumers think cash use will decline in the next three years, just 35% of executives have that expectation.
Already, our research shows, only 20% of Americans’ monthly spend is in cash. However, mobile payments account for an even smaller slice, around 5%. So there’s lots of room for growth in this market, once providers have calmed people’s security fears. It will be interesting to see whether the Mastercard brand will give Masterpass a competitive edge over Apple Pay and merchant mobile payment apps, particularly since, according to our research, what consumers care about most is being made whole if their digital wallets are hacked.
Please stay tuned to the OE blog for more results from “The Future of Money” study. And speaking of staying tuned, it’s just as well the commercial distracted me from baseball last night. The Indians pounded my Cubbies 3–0, with some of the most relentless pitching I’ve ever seen. Now I’ve got to get home for Game Two.