Most of the literature on e-commerce suggests that online payments in India will shift away from cash on delivery (COD). The graph below is typical – by 2016, the expectation is that COD will drop 10 percent, being replaced by mobile wallets.
Mobile wallets work on the basis of transferring money from an existing bank or credit card into the online wallet – and using that to pay online at the merchant site. The consumer creates an account with a m-wallet app or website, adds money to the wallet by debiting his bank account through Net banking or through a credit card, and then to make payments or transfers money. It uses the mobile phone as the go-in-between. The m-wallet uses Bluetooth, QR codes, NFC (Near Field Communication), WiFi, 2G or 3G to communicate with the merchant’s billing POS machine.
This brings me to consumer experience. I was at a suburban restaurant in Mumbai – Smoke-house deli, where I saw an interesting promotion. It promised me Rs 200 off, if I used my mobile phone to pay. I looked at it and thoughts of high tech-queue busting solutions ran through my mind.
The promotion card said that I needed to give my cell number to the billing counter and pay using the link that would be sent to my phone. So far so good. The SMS duly appeared and I was directed to a Qwik Wallet site, where I signed up and was sent a second code for authentication. Smooth sailing. The next screen asked me for my credit card details. I hesitated a bit, but reasoned that this was no different from shopping online, so entered the same.
The screen went into its ‘processing … please wait’ mode for about 5 minutes. Noticing the confused look on my face, Anup, the restaurant manager told me that it would be faster if I download the app and made the payment.
A bit frustrated by now, but still driven by the thought of the 200 Rs off, I complied. The app duly downloaded (thank you 3G) I registered yet again, and was sent another validation code. The app then asked for my credit card details to store the same. I baulked. Visions of the Uber-app floating in my mind, I decided to forego the Rs 200 of the promotion and paid. Using cash.
As a consumer my comfort zone stretches to giving credit card details online or typing them into my mobile phone for a transaction, but not where the card details will be stored.
When I dissect my reaction, I realize my fear is rooted by not knowing what happens to my profile details when I delete the app off the phone. I have heard stories of apps being able to ‘snoop’ data and send back details including contact lists, photos and SMS’s to the server. Uber-scary that.
My experience was one-off of course. I am of the Gen-Y segment; perhaps a Millennial would blithely provide credit card details.
To me, mobile wallets aren’t yet driven by User Experience (Ux) considerations – too much ‘technicalese’ in their design and not enough ‘consumerese’. And retailers don’t seem to realize that wifi is not a precious commodity – it should be provided freely if they want adoption of m-wallets.
These are things that market share projections for mobile wallets probably haven’t considered.