Keep it private
Back in May this year, the University of California, Berkley (UCB) issued a study on Mobile Payments: Consumer Benefits and New Privacy Concerns an interesting read (see news report at http://www.finextra.com/News/Fullstory.aspx?newsitemid=23681). It found that an overwhelming 96% of customers surveyed opposed the idea of handing out personal details to retailers when they buy goods using a mobile phone.
Whilst retailers, banks and consumers have embraced mobile payments and see that they are beneficial in terms of cost and convenience, the issue of privacy has often been sidelined by the payments industry.
Many of the major global players that have entered this market have already designed their mobile payments system to collect information about their customers, which eventually will build a detailed profile on their buying habits. The plan is for the mobile “wallet” to replace loyalty cards, but, be aware, mobile wallets will be able to extract much more data than the traditional loyalty card. All very well if this is what we intend and the data is contributed on an informed basis. After all, isn’t this a sophisticated marketing technique making it more targeted, and hence valuable, for us, the consumer? Arguably, this could be seen as a service to the customer who will be alerted to offers and deals that are relevant to them. Of course. However, as demonstrated by UCB’s survey, US consumers are actually very concerned about providing so much personal information. And can the customer really be assured that their private data is safe, secure and not abused? How can the customer be informed about what data is held against their profile, and who has access to this information? The massive data breaches that have hit the headlines over recent times speak volumes in terms of the lack of consumer trust.
The US Senate has had privacy on their agenda for 12 months now and the UCB survey shows that consumer education on the matter does work. At ValidSoft we are strong believers in privacy. You can still reap the rewards of mobile payments without compromising on privacy. The EU has taken privacy seriously with the Europrise Seal. Products awarded this seal are certified as adhering to European data protection regulations. The US could adopt a similar standard, after all what use is the mobile wallet if consumers don’t trust the companies behind it to keep their data private and safe?