Mobile payments 'will replace cash by 2025'
The 'death of the wallet' will take place by 2025, with all transactions being replaced by contactless mobile payments, according to a new report.
The report by Co-operative Food looked at consumer behaviour and shopping trends, with 65% of Co-op customers believing that their phone will be the only payment method they will need by 2025.
The introduction of mobile payment apps and digital wallet services, such as Apple pay, has seen the number of contactless transactions triple at the Co-op over the past 12 months, with the increase expected to continue.
Although the use of mobile payment services is predicted to be the norm in a decade or so, the majority of shoppers are still wary of the relatively new technology.
“It takes a while for consumers to trust modern technology,” explained Cheryl Marshall, retail chief information officer The Co-op Food Group, as 65% of transactions at the Co-op are still paid for with cash.
“For that reason cash is still king as people enjoy carrying money. However, we predict that by 2025, mobile payments will overtake cards and cash.”
Contactless payments have reached almost 11 million transactions a month, with it being used the most on transactions under £10.
Although consumers can use contactless payment on all transactions up to £30, most are opting to use the chip and pin service for transactions over £10. This is down to concerns over how secure the contactless method is and a lack of understanding of how the method is quicker, according to the report.
The Royal Mint has downplayed the finding of the report by saying that the death of cash has long been predicted, but the demand for coins is “as strong as ever”.