Before cash, various credit cards and debit cards there was a time when you needed to exchange things you had to get things you wanted. This is called barter which is as old as the hills. (Davies 2002, 9.) For instance if you were a hunter and you craved fish, you had to find a fisherman who was as sick of eating fish as you were to eat meat and then exchange things you had. But then a problem occurred. What if the other one didn’t want the thing you had but you still needed the thing he/she had? Money solved that problem. (Standish 2000, 13.) Right now even credit cards and debit card are very popular, cash is still the most popular payment method globally. (Eagleton & Williams 2007, 252.)
It is clear that now the rising trend is the mobile payment and mobile wallets. There are already many mobile payment apps such as Google Wallet, Pivo and Elisa Wallet. Especially Elisa Wallet is probably most popular among students because it was offered in addition to the student card (Vartiainen 2012). Many companies and banks are also developing new mobile payment apps all the time and expanding the already existing ones. Recently also Apple released its own mobile wallet, Apple Pay.
But what is a mobile wallet? Mobile payment uses NFC technology, which can be found in most new phones. You just wave the card or the phone in front of a payment terminal, and it will charge the purchase from your account. (Profis 2014.) You can also send money easily for example to a friend of yours from your phone without knowing his/her bank account number. It is also a way to keep track of your own money in real-time, which does not, for example, work so easily with card payment. It’s an easy way to have all your cards at the same place. Right now you are only able to pay purchases of less than 25 euros with the local payment. If your purchases exceed 25 euros you will have to enter your PIN code. (Kärkkäinen 2014.)
The biggest problem with the mobile payment is that people don’t see why they should use a mobile wallet when the card or cash basically does the same thing just as easily. Why should they switch to a different payment method when the current one works still well? (Heggestuen 2014.) There are now also cards with the local payment feature so there is no reason to use a mobile wallet, or is there? A problem is also that many people have never heard of mobile wallets before or if they have, they don’t know what it is. Maybe now that Apple has also released its own mobile wallet, the popularity of mobile wallets will start to increase. But before the mobile paying can become even more popular, it needs to have a better security so customers can trust that their money won’t disappear from their accounts, for instance in cases where their phone is stolen.
One reason for the slow growth of the popularity of the mobile wallets certainly lies in the lack of advertising. At least in my case, I haven’t seen many mobile wallet ads in past years, which may either be due to the fact that I just have missed those ads, which is perfectly plausible, or the service simply isn’t advertised much. How are people supposed to find the new paying method, if they don’t even know it exist?
The change is inevitable. Maybe one day all money is virtual and there’s not any more the real, physical cash and we just have to adapt to that. Cash payment is one of the oldest creations of man, and the most widespread system. Although the payment methods change over time, the basic idea remains the same certainly a long time. (Davies 2002, 9.) We can only imagine how different the world and the payment methods will be in 5, 10 or 50 years from now. Adapting to a new payment method will certainly be easier in the future because the new generation has already learned to use technology from the age three. So far, mobile payment hasn’t been generalized very strongly, at least not in Finland. The reason for this may also be that in many places is not yet possible to pay your purchases by using a mobile wallet. Only time will tell what is going to happen next.
Davies, Glyn 2002. A history of money : from ancient times to the present day. University of Wales Press, Cardiff.
Eagleton, Catherine & Williams, Jonathan 2007. Money: a history. The British Museum Press.
Heggestuen, John 2014. Our 10 Boldest Predictions For The Digital Payments Industry In 2014. http://www.businessinsider.com/the-big-digital-payments-trends-in-2014-2014-1. Accessed October 4, 2014.
Profis, Sharon 2014. http://www.cnet.com/how-to/how-nfc-works-and-mobile-payments/ Accessed October 4, 2014.
Kärkkäinen, Henrik 2014. Mobiilimaksaminen tulee tänä vuonna – tiedä ainakin nämä asiat. http://www.iltasanomat.fi/digi/art-1288647390126.html. Accessed October 5, 2014.
Standish, David 2000. The Art of Money. Chronicle Books LLC. San Francisco, California.
Vartiainen, Niko 2012. Elisa ryhtyy tarjoamaan maksuvälineitä opiskelijoille. Helsingin Sanomat. http://www.hs.fi/paivanlehti/talous/Elisa+ryhtyy+tarjoamaan+maksuv%C3%A4lineit%C3%A4+opiskelijoille/a1344225163598. Accessed October 5, 2014