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10 critical factors drive mobile wallets in SA

Cape Town - As Apple prepares to launch the latest generation iPhone on Tuesday, rumours have been swirling that the device will function as a mobile wallet.

But many South Africans, while open to the idea of financial transactions on the internet, are resistant to using a smartphone as a mobile wallet.

Vodacom and MTN each have platforms that seek to entice people to go mobile as a partial replacement for cash, but take-up has not been stellar.

Howard Moodycliffe, head of marketing, wiGroup, says that 10 critical factors drive adoption of mobile wallet systems.

1. Security

Mobile payment apps remove the need for carrying cash, which reduces security risks to both consumers and businesses. There’s also no physical exchange of bank cards or any entering of PIN numbers into merchant devices, reducing opportunities for fraud. New biometric scanning technology also promises previously unseen layers of security.

2. Speed

Mobile is fast. Instead of rifling through your wallet trying to find the correct amount of cash or the appropriate bank card to pay, and then searching for your loyalty card to earn points, you simply pay with your phone where all your customer data is consolidated. The actual transaction time itself, from authorising to confirmation is also far quicker than a typical card transaction.

3. Convenience

Wallets today are bulky, heavy things, laden with coins, cash, credit and debit cards, loyalty cards, receipts, scribbled shopping lists and pictures of your family. Your phone is in your pocket anyway - why not travel a little lighter by leaving your wallet at home?

4. Budgeting

A slew of modern budgeting and expense tracking apps empower consumers to make smart financial decisions by providing real time data. And by paying with your phone, you have a transaction history with you at all times - no more   waiting for your monthly bank statements and doing a tedious month end tally up of your spending.

5. Loyalty

Consumers love the benefits that come with loyalty programmes, but who wants to keep a bunch of store cards in their wallets? Mobile payment apps should focus on integrating existing loyalty cards to add a layer of convenience to consumers' lives.

6. Automatic discounts

Redeeming a coupon often depends on you remembering to keep it at hand when you make a purchase. By integrating discounts and loyalty into mobile payment apps, consumers can enjoy instant rewards, and know that they're paying the minimum amount required for that particular purchase, with no hassle and a single payment and redemption.
 
7. Cool factor

This is probably more relevant in urban areas, but most young people are loathe to miss out on exciting new technology - this is, after all, the generation that birthed the term FOMO. With carefully constructed marketing, and a slick user experience, service providers can tap into the ‘cool factor’ of mobile payments to help drive mass adoption, particularly among the younger millennials.

8. Smart, personalised marketing

The amount of real time customer data on the average smartphone is staggering. Savvy service providers should tap into this by integrating their marketing and messaging strategies with purchase histories and spending habits to ensure customers only ever receive relevant "in-app" marketing messages at the correct time. Personalised, targeted and highly relevant communication is a strong value add for a consumer.

9. Lifestyle integration

As mentioned earlier the mobile phone is a lifestyle enabler and no longer simply a communication device. Smart mobile payment service providers should build apps that interact with other lifestyle apps on a user's phone. For example, making a mobile payment for your lunch could trigger an alert on your fitness tracking app reminding you of your dietary goals. The potential for cohesive integration into a smartphone user’s daily life is endless.

10. A completely digitised wallet

The final frontier for mobile wallet advocates is to integrate the rest of the essential real-world items into mobile phones. Most people have their driver's licence in their wallet - a smart provider would find a way to integrate the licence cards with mobile phone tech.

The new smart ID cards currently being rolled out to SA citizens could also potentially be digitised to add more convenience to customers' lives. Mobile payments can only benefit from the mobile phone completely replacing the whole of the wallet and not simply the transaction element.

Above all of these, a mobile wallet system has to be universal or, at least different systems need to be interoperable and instant.

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