Why Isn’t Anyone Paying With Their Phone Yet?

Gene Marks

I want to use my smartphone to pay. I really do. I hate carrying cash and prefer to leave my wallet at home. The problem is, I can’t. Whenever I’ve tried to use my Android Pay, I haven’t been able to. The people behind the cash register – most recently a young lady at a restaurant at the airport – look at me like I’m from Mars. The folks behind me in line look annoyed and impatient.

How can that be?

The hand logo on the point of sale device suggests I can pay with a smartphone. And there’s a sign that says “Android Pay accepted here.” Yet, when I try to pay that way the employee doesn’t have a clue what to do. Flustered, I whip out one of my credit cards for small business owners and move on.

Every day, it seems, somebody is touting a new mobile payment app. There’s Apple Pay, Google Wallet, Android Pay, and Samsung Pay. Starbucks has its own mobile payment option. PayPal and Square are doing the same. Everyone’s jumping into the mobile payment space and why not? There are even useful apps for small businesses.

It must be a really big space. What an opportunity there is! Am I right? I live in center city Philadelphia. I go out to eat, get stuff at CVS, buy groceries, drink coffee, garage my car, and go to the movies. But for every single one of those transactions I use a credit card. And at the places that don’t accept credit cards – mostly little restaurants and small merchants who don’t want to shoulder the fees – I use cash.

I know I’m not alone

None of my friends pay with their smartphones, except for one who steadfastly swears by her Starbucks app, which requires putting money on an account with Starbucks in advance, a concept that seems crazy to me. My kids don’t pay with their smartphones. My kids’ friends don’t pay with their smartphones. Maybe, someday, my grandkids will pay with their smartphones, but that’s a long shot at this point because it would require my kids to grow up, get jobs, and meet someone who also has a job so they can afford a smartphone of their own. The reason no one uses smartphones to pay is Apple. And it’s Google. And it’s PayPal and all the other payment services. They built the technology, but they’re not giving merchants any incentive to accept mobile payments. Merchants aren’t getting a break on fees and they’re not getting help with purchasing the point of sale devices needed to accept mobile payments. And they certainly don’t want to take the time to train their employees if that training will never be used. That’s why the people working at these shops act like you’re trying to pay with a light saber when you pull out your smartphone to make a purchase.

Customers aren’t being given incentives to use their smartphones either because none of the mobile payment services are compensating them to do so. So for now, it’s just as easy to swipe a credit card and get on with your life.

The field has been built

But will they come? The technology is in place. It’s pretty secure (nothing’s 100% secure) and it’s in many people’s hands. But it will only catch on if the mobile payment companies put real money behind the technology to motivate merchants, restaurateurs and their customers to use it. Share some of those credit card fees, guys, and watch your revenues grow as a result.


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