Tech firms like Apple still need to convince a lot of people that using their smartphone for contactless payments isn’t a major security risk.
Many consumers are still confused by the concept of paying for stuff with a smartphone, but a huge proportion of those who do get it don’t trust it.
That’s what communications regulator Ofcom found in its latest survey of adults in the UK, where 42 percent of smartphone users believe contactless payments with a mobile device is not secure.
Ofcom also found that 40 percent felt that a service like Apple Pay — the only real option currently available in the UK — is secure.
However, 24 percent said that using a smartphone for contactless payments is “not at all secure”, compared to 10 percent who believed it was “completely secure”, while 19 percent reported being unsure.
The figures highlight the difficulties that Apple, Google and Samsung face in convincing people to ditch plastic cards in favour of their smartphone to make retail payments.
And that's despite the fact that cards aren’t considered particularly safe either, particularly in the US which is now moving to chip and PIN used in Australia and Europe.
Apple launched Apple Pay two years ago, promoting it as a more secure way of making payments at cash terminals.
It requires an iPhone 6 or new with Touch ID, and relies on NFC, as well as a chip that’s isolated from the operating system to store a cryptographic representation of a card number.
iPhone owners can use the service if their bank supports it.
Then they need to enrol a card with Apple Pay on the iPhone. They can then make purchases at retail outlets that support contactless payments.
The platform is now supported by hundreds of banks in the US.
As of March, with the UK’s Barclays Bank coming on board, all major banks in the UK support it with Mastercard, Visa, or American Express cards.
Apple Pay in Australia is limited to American Express cards issued by Australian banks.
Security experts have vouched for the security of Apple Pay over cards, yet despite widespread support from banks in the US, payments using Apple Pay accounted for just one percent of all retail transactions in the US, according to research firm Aite Group.
Consumers apparently struggle to understand why phones are better than cards.
Still, security might not be such a major obstacle in the future.
Younger people and people from wealthy households were less likely to perceive smartphone contactless payments as insecure compared to older and poorer people, according to Ofcom.
It also found that more people who owned a smartphone confident in the security of contactless payments than people who owned a standard mobile phone.