As we all know, credit cards are the dominant method of making online payments. However, recent studies suggest that credit card use for online purchases may be on the way out!
Credit cards have been in use in some form for around two hundred years. As of late, credit card use has skyrocketed for both physical and online purchases. Although they have been the premier method of online payment, several short-comings are becoming ever so evident to consumers and retailers. Issues such as high transaction cost, high risk of identity theft, and convenience issues are starting to become more prevalent as alternative payment methods have emerged.
Experts suggest that mobile wallets and credit services specifically designed to be used online are going to surpass credit cards in frequency of use in the coming years. This is evidenced by the massive jump in dollar amounts of alternative purchases from 2009 to 2010. In 2009 there were approximately thirty-four billion dollars in alternative payment method purchases, followed by a nine billion dollar jump to forty-three billion dollars in 2010. By 2015, it is estimated that alternative payment methods will account for over eighty-five billion dollars of online sales. Multiple consumer reports show that forty-six percent of consumers have used an alternative payment method within the past year. These are large numbers show the potential for alternative payments to overtake the almighty credit card.
Only time will tell if digital wallets and other alternative payment methods will surpass credit cards as the dominant method of online payment. Have you/would you use an alternative payment method? What is your opinion on this information?Would you consider using an alternative payment method in the place of a credit card?
http://mashable.com/2011/03/02/credit-card-decline/
http://www.sarahbundy.com/wp-content/uploads/2013/03/Digital-Wallet1.jpg
we will see what the future brings
ReplyDeleteI can see this happening in the near future. I think that everything is going to eventually be done on smart phones. I know that it would be more convenient to the general public.
ReplyDeleteI personally want to keep my credit cards. Mobile payments could not take the place of cash or credit when it comes to going out to eat. I would feel unsafe and insecure without a physical item available to hand to someone.
ReplyDeleteLaura Mayhew
I can relate to this, I personally make 85% of my payments and purchases through online/through my phone so I can clearly see this as being a main source in the near future for everyone. I personally believe that mobile payments, purchases, and any other transfers of money is man more simple through online and phones. I can see in the future being able to just scan your phone and being able to purchase something at a store or just clicking a button and purchase something online in a matter of seconds. (jcapatin@uncc.edu)
ReplyDeleteI agree with this idea whole heartily. I make a majority of my product purchase using my phone or online, and I have been waiting for the day i can scan my phone for my different accounts instead of carrying a wallet at all! The technology is there, I just think people aren't comfortable with the security and reliability.
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Alex Herko
Mobile payments are definitely becoming very popular.Would anyone be willing to entirely substitute a mobile wallet for cards?As time passes,security involving mobile payments will improve to that of traditional credit/debit cards.At that point it will be a matter of personal preference rather than a matter of security.
ReplyDeleteI love using PayPal. I feel secure knowing that they protect my online purchases. For example, my mother ordered something online and used PayPal to pay for the transaction. The website she ordered from was a scam and sent her the wrong product. She tried several times to get in touch with the company to fix the mistake and they never responded. She researched the company online and found out that many people were going through the same thing. She contacted PayPal and they refunded her entire purchase price. Companies like PayPal do have your back. I also like the fact that you can use either a CC number or your banking account information.
ReplyDeleteKarli, I had a similar experience with a company that was supposed to send us a car part, never did, and luckily we had purchased through PayPal, and our money was refunded. I know more and more people are using PayPal as an alternative form of payment. I am part of a running group, and when our leader buys shirts for races and various other products PayPal makes it so nice to be able pay her, and not have to worry about tracking her down to get her the money. I think it will be interesting to see if credit cards/debt cards are on their way out. I still remember what a big deal it was to get my first debit card at 16. As for the number of identity thefts, I would most certainly think banks and other institutions are desperately seeking to find a solution to this problem. Just yesterday I had a close friend post on FB that her bank account had been hacked and her credit cards were still in her wallet with her. She lives in NYC...the thieves PA. The bank gave her her money back, but the banks are losing money left and right when this happens.
ReplyDeletePurchasing an item online with your credit card will definitely have a high risk of someone getting your information but I think that mobile payments would become very attractive if it reduces that risk. Since everyone has an iPhone now, it wont be long until technology changes and CC will be less attractive.
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