Consumers are planning to spend more cash than credit this holiday season, according to a survey conducted by Bankrate Inc. Out of 1,000 consumers surveyed, 39% said they intended to use mostly cash, while 31% opted for debit cards. Only 22% said they’d use credit this year. This comes as a shock to many major merchants who relied on open-to-buy potential offered by credit. If these results hold true, it could spell trouble for merchant profits this year.
Of course, the study figures could be exaggerated if consumers were embarrassed to share a true preference for credit, as it may make them seem financially careless. The demographics of the survey are interesting. Participants between the ages of 18-29 had a strong preference for debit (48%) and the weakest preference for credit (14%). Ages 30-49, almost equally preferred cards with 28% saying they would use debit cards and 24% citing credit cards.
The projections for mobile payments was dire, however. About 70% of customers surveyed had internet access, and 84% said they were not going to use mobile wallets for shopping. Only 14% said they would use mobile wallets. 36% of respondents cited security concerns as to why they wouldn’t use mobile wallets, while 31% cited convenience. This is a shocker for some as there has been plenty of hype about mobile’s ability to change the payments game.
These results imply that there is a lack of education regarding mobile payments across the general population, which could be easily solved. But the convenience factor, may not be so simple to fix. It is just as easy for consumers to swipe their cards as it is for them to take out their phones. So mobile-payments services must find ways to entice consumers to use their technology, at least in the beginning.
Retailers must be ready to provide every type of payment service to consumers. Nowhere is this more important than in high risk businesses such as the electronic cigarette industry. EMB provides a payment gateway for e-cig merchants that accept a variety of payments like debit/credit cards, checks, e-checks, and more.