Beyond Cash and Plastic: Will You Wave Your iPhone?

Source: Thinkstock

Source: Thinkstock

So, today is a big day — a day many loyal Apple customers have been waiting for. Today, Apple announces the iPhone 6 and iWatch. Along with several upgrades, the new phone comes equipped with Near Field Communication (or NFC) technology. Although Apple is not the first to introduce NFC technology, the new Apple devices may certainly draw attention to NFC and all that it has to offer.

NFC allows two enabled devices to communicate back and forth through a wireless signal. “Whether swiping your smartphone at the checkout lane in the grocery store, waving it over a display at a local museum, or bumping phones with a friend to share the latest games, near field technology lets you pay, play, and learn easily,” says NearFieldCommunication.org

You can simply wave your phone in front of a payment terminal, make your payment, and be on your way. Sounds pretty good right? While some find this technology intriguing, others are wary of it. Would you wave your phone at a credit card terminal in a checkout line?

CreditCards.com wanted to know how people felt about this method of paying by phone. So, along with Princeton Survey Research Associates International, they surveyed around 1,000 people and posed the question: “If you could use your cellphone to pay for things you buy everywhere, how often would you do so?” (You can view the survey results here.)

The General View

Surprisingly, most people said they’d rather not pay by smartphone. Only 4 percent of survey respondents said that if given the opportunity, they’d use this method “always,” and only 9 percent said they’d pay by phone “most of the time.”

The majority of respondents — 62 percent — said they’d either “never” use this form of payment, or they’d “hardly ever” pay using this method. Around one-fourth (22 percent) of those surveyed said they would wave their smartphones “sometimes.”

Why People Say No to Phone Payments

Security is a huge factor. Some people simply don’t feel comfortable having their financial data traveling mid-air from their phone to a payment terminal. The recent iCloud hacking situation doesn’t help to ease their security concerns, either.

This is also not the first new technology we as consumers have been reluctant to embrace with open arms. “Withdrawing cash from ATMs and paying bills online took awhile to catch on as the public became persuaded that the benefits outweighed the risks,” according to the CreditCards.com survey’s interview with Tim Bajarin, president of Creative Strategies, a high-tech research consulting firm based in Silicon Valley.

Demographic Differences

As expected, those in the younger age groups were more inclined to say they’d use NFC technology than those in the older age groups. Only 30 percent of millenials (ages 18 to 29) said they would never wave their phones, while around 65 percent of the 65 and over age group said they would never pay by phone. Younger age groups spent a larger portion of their lives using smartphones, and also witnessing the rollouts of new, successful technologies.

Education level and gender also impacted the results. Highly educated respondents were more inclined to be willing to pay by phone than those with a high school education or less. Based on the results, men seem slightly more willing then women to pay by phone as well.

Down the Road

Sometime in the near future, we may all be waving our smartphones in front of payment terminals. The CreditCards.com report mentions a 2012 Pew Research study, which found that by 2020, most of us will probably be paying using these more advanced methods, and there will be little need for cash or credit cards.

If consumers see the technology is safe, useful, and convenient, the overall view of it may very well shift and these terminals may become the new norm. How do you feel about NFC technology?

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