The future hates your wallet
Alexander George. Article from the Popular Mechanics October 2015 issue.
Phones have already replaced cameras, alarm clocks, and those bulky old CD binders. Is the wallet really next?
I shouldn’t be this nervous. But standing in line waiting to buy underarm, I can’t help it. Almost a dozen customers are behind me, and a good number of them would probably be annoyed to know that I intentionally left my wallet at home. All I have is my phone.
When I get to the counter and ask the checkout clerk if I can pay with my phone, he shrugs, says, “You can try,” and gestures towards the terminal. I hold my phone over it, press my thumb to the Home button to prove I’m me, and the screen dances and confirms the charge to my American Express. The process is shockingly quick, and leads me to tentatively ask a question I will repeat many times over the next few days: “So I’m all set?”
It shouldn’t be this way. Google Wallet came out when Obama was still in his first term. Apple Pay was announced last September. And despite the recent introduction of the Apple Watch and the Jawbone UP4 (a fitness tracker and payment device developed with American Express), more than four years in, the technology hasn’t taken hold. The concept isn’t that radical. Instead of a magnetic strip, your phone uses near-field communication (NFC), a short-range radio frequency, to give your credit card information to the vendor. No signing a screen, no receipt to find in your laundry a week later and throw away.
I want this technology to work, and I couldn’t understand why it hadn’t, so for one week, I committed to shopping with only my phone. There is no directory of participating businesses, so I came up with a workaround. MasterCard’s Nearby app catalogues “contactless retailers”, stores that accept specially equipped cards for swipeless payment, and those stores usually have NFC terminals. With that as my guide, I used my phone to pay at the convenience store, coffee shop, and in a taxi from work. I even used the most convenient of payment methods at the least convenient of places: the city motor vehicle licensing department. By the end of my experiment, the idea of reaching for my wallet and swiping a card felt slow.
So why aren’t businesses incorporating such consumer-friendly technology? One reason is that they’re not convinced that something better won’t come along in a few years. “Merchants need to hear, “This is the last cent you’ll ever have to spend on a register,'” says Leon Majors, an analyst at Phoenix Marketing International who studies Apple Pay. “Some merchants haven’t upgraded payment systems in twenty years.” The other reason is that we aren’t demanding it. Until we do, we’re years away from being able to leave our wallets at home. At least not without a plan.
Paying with your phone in the current environment is like driving an electric car. You’re not alone, and there is some infrastructure to support you, but before you head out, you need to know exactly where you’re going. And you need to tell everyone you know just how much you’re improving the world by doing it.
How it works
1. When held within 10 cm of an NFC terminal, the phone loads your default payment card.
2. You confirm you’re you with your fingerprint or passcode, and the app generates a temporary card number unique to the exchange.
3. That number is sent to your bank. After confirmation, the credit card company authorizes the transaction.
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