Tag: mobile wallets

While cash purchases are becoming less commonplace in Canada, it’s plastic, not smartphones leading the way.

A new Moneris report revealed that Canadian mobile payments enthusiasm is finally growing. The report’s prediction is that by 2013, only 10 percent of transactions in Canada will be made with cash. In 2014, that figure was still 35 percent.

Digital payment technologies such as mobile wallets will be greatly responsible for reducing cash use.

The 70 percent decline in cash purchases from 2014 through 2030 will be greatly the result of Canadian mobile payments adoption. The number of contactless transactions and mobile wallets in use will reduce the need to carry cash.

The report indicated that one in four Canadians between the ages of 18 and 34 years old already prefer using a mobile wallet over cash or plastic. Comparatively, only 18 percent feel that way in the 45 to 54 year old age group. Among those from 55 to 64 years old, 10 percent prefer mobile wallets. For those aged 65 and over, only 6 percent would want to use their smartphones instead of cash or credit and debit cards.

That said, there remain some very specific barriers to Canadian mobile payments adoption.

Leger conducted a survey in which there were 1,516 Canadian participants. When asked why they would choose not to use a mobile wallet, 62 percent had their doubts about security. They said they would be more likely to use smartphones to make purchases if they felt confident in mobile security.

Moreover, 42 percent said they’d be interested in using mobile payments if there were more stores that accepted those transactions. Another 50 percent said they would be interested in using smartphone payments if it meant they could leave all their plastic loyalty cards at home.

The report also showed interest in some of the additional opportunities offered by Canadian mobile payments. For example 48 percent of those surveyed said they would use a mobile wallet if they were emailed a receipt. Furthermore, 46 percent said they would use it if all stores accepted the technology. Moreover, 41 percent said they would be interested in using them if they could also store their ID on their phones so they could leave their entire wallets behind. Another 35 percent said they would use mobile payments to pay for public transportation fare.

The Chinese smartphone transaction system is launching in the western continent with a start in Canada.

China’s UnionPay mobile payments system is now in North America. It took its first steps into the continent by launching in Canada. This mobile transaction service is the international subsidiary of the Chinese interbank network. The network functions to link the credit and debit card payments throughout that country’s banks.

UnionPay International is enormous, placing third in the world as a payment network.

Only Visa and MasterCard are larger payment networks than UnionPay. This is primarily because of its reach throughout China and its recent rapid expansion outside the country. Now that UnionPay mobile payments launched in Canada, its QuickPass system will be available to many Canadian merchants. It will be focused on “daily spending” merchants in that country. This represents the first time the system has entered North America, despite its wide expansion elsewhere.

UnionPay mobile payments can be used with QuickPass enabled smartphones or EMV chip cards.

There is a QuickPass spending cap at $100 (CAD) for transactions without a PIN or signature when using either credit or debit. This is meant to enhance the system’s mobile security. Moreover, it will make it fast and easy for Canadian consumers to use the system without having to enter a PIN.

As of yet, it is not known precisely how many Canadian merchants are interested in these mobile payments. The number of companies participating in QuickPass was not revealed at the launch. However, UnionPay has said that there will at least be more than 70,000 merchants with the required tech. It also pointed out that the infrastructure in the country is well suited to accept contactless payments.

Therefore, there is potential that a sizeable percentage of those with the ability to accept contactless payments will participate.

At the moment, the North American launch of UnionPay mobile payments is exclusive to Canada. However, there is a very large potential audience in the rest of the continent. This may mean that the company is setting up to subtly become a direct competitor with certain leading mobile wallets such as Apple Pay.