Mobile pay – real competition is with the physical wallet

Mobile pay will not get real traction as long as customers have a physical wallet with physical cards. Replacing plastic loyalty cards is a start but to get traction for Mobile pay, vendors should focus on enabling customers to ditch the physical wallet. This means smartphones should handle all my cards like – drivers license, Costco card, insurance cards, YMCA card etc.

Imagine you get stopped by a traffic officer. To show your driver’s license, you open up your iPhone app and tap it/scan it on a tablet the officer has. Officer next asks you for insurance information, you open up your insurance card and tap/scan again. Officers looks at your information and after making sure all is well, hopefully lets you go without a ticket.

A companyddl called MorphoTrust is working on something similar for driver’s license. CNet has a great article on the company.

Now imagine going to the doctor’s office. The receptionist asks you for proof of insurance. You tap/scan your smartphone on a tablet in the office. The receptionist pulls all the information she needs on the tablet and prints out what ever is needed.

Now imagine going to your Gym and again tapping/scanning your smartphone  at the scanner/tablet at the entrance.  The current status of this market is pretty messy – YMCA has over 15 apps for different regions, developed by different agencies.

I believe mobile pay vendors have a huge opportunity to provide thought leadership, technology and security solutions to address a number of these use cases. By addressing these use cases combined with vertical out reach, mobile pay vendors will reduce consumer dependency on physical wallets and drive adoption of mobile payments.

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