Learning from the limit of debit card systems
One issue for mobile money in the connected world is the press, and while stories such as the Washington Post’s look at an eight year old girl who managed to rack up a $1,400 bill for in-app purchases in a short space of time on the Smurfs iPad application make for great copy, they also point to a number of potential concerns in putting digital money on tablets and phones.
It’s getting the balance of convenience and security just right.
Part of the reason that the Smurfs app (and others in Apple’s iTunes store) are open to running up massive bills is partly to game mechanics, and partly to keep the user happy. Once the iTunes account password is entered, everything stays “unlocked” for in-app purchases for around fifteen minutes.
And those purchases, in many cases, are for an intermediate “toy” currency (think Facebook credits or Farmville dollars) that divorces the reward from the payment (and that’s magnified by iTunes taking time to email a receipt to the nominated email account).
Each one of these media stories eat away at the confidence that people have in monetary transactions on their personal device, and customers need to be reassured that they are not going to get into any “bill shock” problems. Barclaycard’s UK trial of contactless payments is limited to transactions up to £15, I suspect partly for this reason.
There is precedent for this as a new payment system comes on board – with the introduction of debit cards with a daily transaction limit of £50. Now of course that’s lifted for general use, and nobody things twice about using debit cards after the media scare stories when they first came out.
The question is will the inevitability that surrounded debit cards translate to mobile money and digital payment systems?