The adoption of mobile payment technology has been slow for both consumers and merchants. Instead of a revolution, it has turned into an evolution. And because of this, plastic cards are here to stay...at least for the foreseeable future.

1. Why Plastic Cards are
HERE TO STAY
...at least for the foreseeable future

2. INTRODUCTION
The payments industry had high hopes for a quick adoption of mobile
payment technology, especially after several "game changers" entered the
ring - Apple & Google, just to name a few. However, what was supposed
to be a digital "revolution" has really turned out to be an "evolution".
Adoption of digital payment solutions by both merchants and consumers
is progressing at a slow rate, which has prolonged the use of plastic
cards. With several roadblocks in the way, it looks like plastic cards are
here to stay...at least for a while to come.
INTRODUCTION

3. A 50+ YEAR INFRASTRUCTURE
Since the Diners' Club card began to gain popularity in the early 1950's, consumers have had a
love affair with their credit cards. Most Americans cannot remember a time without plastic cards
in their wallets. And even with digital technology, some find it hard to give up the "security" that
comes with a physical card. Besides that, the infrastructure is very costly, which is difficult to cast
aside.
old habits are
hard to break

4. IT'S A THINGGENERATIONAL
While Millennials were born looking at cell phones, the Baby
Boomers were not. And although many baby boomers have taken
to using cell phones and tablets for communication and social
media purposes, many have not explored the world of electronic
payments. Why? Because they feel more comfortable using the
plastic cards they have known all of their lives.
25%
Baby boomers account for
nearly a quarter of the
U.S. population*
*U.S. Census Bureau, April 2014

5. NOT EVERYONE OWNS A
SMART PHONE
*Icon made by Freepik from www.flaticon.com
In order to use electronic cards or digital apps, one must own a smartphone,
however, there is still a large part of the U.S. population that does not.
Financial constraints are a major reason why more than a quarter of Americans
don't own smart phones...meanwhile, plastic cards remain "free" to consumers.
Only 64% of
U.S. adults own
a smartphone
Smart phone ownership is highest
among young adults & those with
high income & education levels.

6. THE PACE OF TECHNOLOGY
is faster than
Image courtesy of Gallup.com
Of those Americans that own a smart phone, only
13% of U.S. adults have a digital wallet on their device*
9 out of 10 consumers that don't have
a digital wallet are very unlikely or
unlikely to start using one in the
next 12 months.
Of those that have a digital wallet, 76%
have never used it or used it very little
*Source: Gallup.com, "No One Is Winning the Battle for Digital Wallet Customers" July 2015
adoption rates

7. PLASTIC IS FASTER AND EASIER TO USE
Reaching for and swiping a plastic card is less
cumbersome than finding the right app or digital wallet
on your phone, plain and simple. The likelihood of a
plastic card failing is slim, but with a cell phone, there
could be a number of problems: dead battery, lost/stolen
phone, device malfunction, or a technical glitch. And in
the case of digital failure, a plastic companion card is
required as backup (just another reason plastic is going to
stick around for a while).
75%of consumers that don't use digitalwallets said it is easier to pay withcash or a plastic card*
*Federal Reserve study of 2,900 consumers (2015)

8. NO CLEAR DIGITAL WINNER
Although there are several digital players in the game, none of them are rising to the top to
become the true "winner." Merchants who want to accept mobile payments cannot commit to all
available technologies, so until a few rise to the top, consumers will continue to rely on their
plastic cards.

9. CONSUMERS NEED TO BE EDUCATED
CONSUMERS are confused by the number of choices available
CONSUMERS do not know which retailers accept digital payments -
and which of the payment systems they accept
CONSUMERS do not know that older smartphones are not equipped
with NFC (near field communications) technology and cannot be used with
some mobile payment systems
However, they do know that plastic cards
are accepted everywhere
1.
2.
3.

10. PEOPLE PREFER PHYSICAL GIFT CARDS
People prefer to give their friends and family physical gift cards vs.
digital gift cards. Many feel like digital gift cards are like a "cash
transfer" whereas physical gift cards provide the recipient with
something to open. Also, digital gift cards can be easily forgotten by
the recipient and never used.
In a recent survey of a
thousand U.S. shoppers, the
Retail Gift Card Association
found that 79% actually
preferred to give a physical
card as a gift, as opposed to a
digital card.

11. PLASTIC CARDS ARE BETTER FOR BRANDING
Out of sight, out of mind. Digital
cards get buried in the deep recesses
of one's inbox and before you know it,
they are forgotten.
Physical gift cards, however, are touched,
moved and noticed in the wallet. Plus,
there is a nice bit of billboard space on
the card to reinforce your brand image
and remind the gift recipient to shop at
your store.

12. INTRODUCTION
As you can see, there are several reasons why plastic cards remain a
popular payment choice. For some it is convenience or habit...for others it
is a better sense of security. And for these reasons, the life expectancy of
plastic cards is likely to exceed 10+ years. So, even if it appears that
there is a great digital revolution happening, plastic cards are still here to
stay...at least for the foreseeable future.
IN CONCLUSION

13. Brought to you by
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888.817.8121
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