Say Goodbye To Your Wallet

credit cardsGoing, going … (Photo via Hamera/Thinkstock)

You know the feeling. A cold, hard chunk of change arrives by check, and the second it’s in your hand, you get all Fat Bastard about it and find yourself saying “Get in My Bank Account.” It happened to me the other day, so I went to the bank to deposit it. Only the ATM decided it didn’t like my check, and the ATM at another branch also wasn’t willing to play nice. When I went inside the bank to ask a human for help, I learned their servers were down, meaning that unless I had my account number memorized, I was out of luck. Then I saw it: My bank, Cambridge Savings, had a huge sign on the wall introducing mobile deposit. It was like a choir of angels began a heavenly chorus. Using their mobile app, I was able to simply take a picture of the check’s front and back and make a deposit. Within an hour, I received an email telling me it had gone through. I felt like I was a Jetson.

And it’s only the beginning. A report released this morning by the Pew Internet & American Life Project has found that Americans are becoming increasingly comfortable using our smartphones to do our banking, to the point where they project that in 2020, credit cards will become obsolete. As of March of this year, 21 percent of mobile phone owners had used mobile banking services on their phones, and another 11 percent said they intended to. Some 12 percent of users already use their phones to pay bills, so the move to actually paying with your phone (instead of swiping your plastic) is the logical next step.

Of course, that doesn’t mean that credit card companies (and the massive debt that they need to function) will be going away any time soon. Already, they’ve been exploring the possibilities for a technology called near field communication, which uses radio waves to transfer funds over encrypted channels, and have begun creating partnerships to help move into the mobile space. Google is working with Citibank and Mastercard to built its Google Wallet product, which launched last year. Verizon, AT&T, T-Mobile, Visa, American Express, Discover and MasterCard are working on a virtual wallet called ISIS, which will be available in select cities this year. PayPal and Visa are planning to launch their own mobile system, and there are rumors that Apple is as well.

So does this mean the end of plastic as we know it? Will our privacy suffer when we hand over even more information to our phones? And will you be completely screwed — even moreso now — if you lose it? Pew spoke with panel of experts for their opinions, and naturally they’re mixed. But 65 percent felt that mobile wallets were inevitable. As Susan Crawford, a Harvard professor and former a special assistant for technology policy for President Barack Obama, pointed out: “There is nothing more imaginary than a monetary system. The idea that we solemnly hand around printed slips of paper in exchange for food and water shows just how trusting and fond of patterned behavior we human beings are. So why not take the next step?”

  • Kurt

    I’ve been using mobile deposits for quite a while now, and it is awesome.

    From check in hand to check in the bank takes like a minute or two.

    The death of wallets? I’m not sure about that…..I like the idea of having something physical for my purchases….I even still use cash:)

    I don’t mind the depositing part with checks…I’m just still leery about paying for things on a mobile device though….just call me slightly old fashioned.

  • Janelle Nanos

    Thanks Kurt. I find myself using cash less and less now, actually, and will go for weeks without hitting an ATM. And that’s in part thanks to the fact that every time I swipe a card, there’s a digital record of how I spend my money, which I can manage and track. I’m a bit leery about paying by phone as well right now, but I’ve used Level Up a few times and have found it ridiculously easy. So we’ll see!