As technology is progressing, the number of people conducting mobile money transfers with no human involvement is increasing. Many companies have now mastered the art of a swift hassle-free registration process, making it considerably easier for end users to download an application and complete one off payments.
The Growing Use of Mobile Apps
The Guardian proposes Application Development has become a real business nowadays, thousands of diverse mobile applications of different types are being released every day from around the world. Apps have now become an integral part of our daily micro-moments, with people spending an average of 30 hours per month on them, according to Nielsen. Google state apps play a key role in those I-want-to-know, I-want-to-go, I-want-to-do, I-want-to-buy moments.
The Reduction in the Exchange of Tangible Money
More recently, there has been an increase in start-up entrepreneurs and corporate giants, all competing to shape the manner in which consumers exchange 21st century goods and services. “Mobile Fiat Currency” is the term used for the action of sending and transferring legal tender using a mobile phone. There are now numerous ways in which this can be done, however, the largest growing trend is via applications.
Apple Pay and Android Pay are applications that a user can download on their mobile phones and allows them to tap their smartphone on a reader to complete a money transaction. More and more companies are taking this route and creating apps which allow the end user to pay via their phones.
There is less and less need to carry cash in circumstances where it used to be essential. Examples include Uber, a transportation network company which has changed the way in which members of the public commute around major cities. Where carrying cash used to be essential in order to get a taxi, you can now order and pay in seconds. Another example of this change is pay and display parking. ‘Loose change’ used to be essential to pay for parking in shopping centres. Customers now have the option to pay via an application, which can pin point your location through the use of GPS on your mobile phone.
Additional Benefits of Using Applications to Pay
Not only is the use of these applications eradicating the need to carry tangible currency, they are also providing more information and a better valued service to the consumer. Uber not only allows you to pay by your phone, it also informs you beforehand on how much the journey will cost, how far the driver is away from your location and who the driver will be. Pay and display apps prompt the user that they have 10 minutes until their ticket expires and allows them to increase the time without disrupting their shopping day out. Users can now also pre-order items, for example the Starbucks’ application allows customers to pre-order and pay for a coffee in advance allowing them to go straight to the collection point to find their coffee waiting for them. The use of these applications are saving time and are removing the longest period time when purchasing a product or service, which is waiting to pay with the physical exchange of currency.
Concerns in Using Applications to Pay
One of the major concerns for consumers when using these applications to complete purchases is security. It is important that every single mobile application innovation takes place in step with cyber security. Applications are storing payment details, so it is vital that there are correct security procedures in place to protect from breaches.
Non-cash payments also tend to increase the human tendency to overspend, according to The Money Pages. There is the danger for end consumers that the ease of purchase can increase their spending habits. The number of small impulse purchases will increase with more businesses using applications as a payment process.
However, for businesses this is a positive, more customers will be using their service due to the ease of purchase.
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