New Fed Study Explores Banks’ View on Mobile Payments

A new study from the Federal Reserve Bank of Boston has found that mobile payment services are steadily accelerating despite doubts that widespread adoption is in the near-future.

Though the survey of banks and credit unions found that 63 percent believe that mobile payments at the point-of-sale will not be widespread until at least 2022, 20 percent said that mobile payments could take hold widely within two years.

Despite the study’s cautious outlook for mobile payments adoption, the Boston Fed said in a press release that that one-quarter of all U.S. banks are capable of supporting in-store mobile payments and 40% planning to add the technology within the next two years.

Of the respondents, 67 percent said they plan to partner with third-party payment processors to deliver mobile payment services. Four percent of respondents said they planned to develop their own payment solution, and another 36 percent said they plan to partner with a payment card network for mobile payment solutions. Nearly all banks support third-party mobile wallets, survey forecasts said.

A large majority of respondents – 97 percent – said that the need to stay competitive was the primary reason they adopt mobile payments, and 83 percent also noted security as a top reason. Six in ten said customer engagement was a top reason as well.

The report utilized survey data collected from 706 banks and credit unions in seven different Federal Reserve Bank districts completed in the fall of 2016, representing 8.7% of all banks and 3.1% of all credit unions nationally, the report said.

Access the full study from the Boston Federal Reserve Bank here.