E-Wallets Need to Offer More to Catch On with Consumers

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In today’s environment, in which smartphones are ubiquitous and the emphasis is on using apps to perform just about every task imaginable, it is surprising that the mobile wallet category has struggled. It seems like a natural fit for the mobile world. Of course, it hasn’t turned out that way. The category has pretty much remained at the margins.

Last week, it got some much needed good news, but evened it off with some bad news too. First, the good news: Isis, which launched last November, reported that it averaged 20,000 new customers each day. That was double the daily March average, the company said.

The Isis service launched with AT&T, T-Mobile and Verizon Wireless on board. Sprint was not. Now, Isis functionality, which requires near-field communications (NFC) and a secure SIM card, is possible on 68 devices and is preloaded on 14 smartphones.

The bad news is that one of the highly touted mobile payment services, Square Wallet, has been removed from the Apple App store and Google Play. Forbes’ Steven Bertoni said that it was simply a lack of demand:

Square Wallet never took off. Last month I experimented with mobile money, leaving my wallet at home and living by iPhone only. Square’s offerings in New York City were slim. Only a handful on random pizza joints and few eyebrow threading places accepted its wireless payments. My local coffee shop once took Square Wallet but stopped quickly after they found no one was tipping the baristas.

Square is transitioning to a service that enables people to order food ahead of time so that it will be ready when they arrive at the establishment. It is not a new idea. The goal, Bertoni writes, is to offer perks beyond simply paying for goods. That’s the rationale for electronic wallets, but something that can be done in any number of ways. Extra perks, such as cutting the line at the take-out window, may eventually lead people to accept the mobile wallet concept.

The idea that the key to success for the mobile wallet category is going beyond offering a new way to make payments is echoed in an infographic and story at Pymnts.com. The ability to have an electronic version of a driver’s license, payment cards and insurance cards might entice people to use a mobile wallet. A survey of 500 consumers by TSYS revealed that almost half of respondents, 47 percent, would use electronic wallets if they contained everything that is now in their leather version.

The travails of electronic wallets are well documented. What has recently become evident is that the key is to add features, not just replace something that was already being done.