Christophe Uzureau and Kristin Moyer here. Many barriers exist to the more widespread adoption of mobile payments in developed markets, one of them being lack of consumer interest. Another barrier, however much less significant, has been the mobile phone itself. Most mobile phones do not yet include near field communication (NFC) capabilities due to business model, cost rationales and standardization issues.
Is Bluetooth the way forward for mobile payments?
While Bluetooth would potentially remove carriers from the revenue stream, there are too many barriers for it to be viable for mobile payments. Here are five reasons that Bluetooth mobile payments won’t gain traction:
- Lack of security and perception of security by consumers.
- Merchants would need to upgrade the POS to ensure Bluetooth device management.
- Merchants would need an application to verify the identity of the phone-customer since the POS risks reading all the devices in the shop, get the phone with the strongest signal – this will compound security concerns.
- NACHA will likely be resistant to a Bluetooth initiated payment due to (again) security issues. Bluetooth would become the weakest link in the payment value chain, which is still looking to improve the security/integrity of its transactions flows.
- Lack of overall convenience: as a consumer, the related registration/extra security checks would further damage interest. And it’s not like consumers are running towards contactless payments in the first place.