Fraud Concerns Keep US Shoppers Away from Mobile Payments

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Security and privacy concerns remain the top reason for US consumers deciding not to use their mobile devices to purchase items in-store this festive season, according to new research from Inside Secure.

The security vendor polled over 1,200 US consumers to find out more about attitudes to mobile payments.

It found that 39% are planning to use their device to make in-store holiday purchases, up slightly from the 33% that did last year. What’s more, 17% of those that didn’t do so in 2014 are hoping to do so this year.

However, 70% of respondents not planning to make a mobile payment cited concerns around identity theft as their main reason. The same number claimed mobile payment fraud was preventing them from using their device in-store and 71% said the privacy of their transaction data was a major concern.

US consumers certainly have plenty of choice when it comes to m-commerce. Apple Pay, Android Pay and Samsung Pay are all up and running in the country, and there’s also the popular Starbucks payment app.

However, the research noted that US shoppers trust their banks more than these consumer brands when it comes to managing payments.

Some 51% of mobile payment shoppers said they’d prefer to use an app from their bank rather than one provided by a third party such as Apple or Google.

The research highlights the problem these technology giants have in persuading consumers to use their services.

Apple Pay, for example, contains a number of security safeguards including biometric authentication, encryption and tokenization, which means card details are never seen, stored or transmitted by the merchant.

However, the system came under fire earlier this year after it was claimed fraud levels spiked.

The problem in the end was blamed on the banks which weren’t authenticating users properly, allowing fraudsters to load stolen card details onto Apple Pay-enabled iPhones.

Photo © Stanisic Vladimir

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