Even with all the advances in payment technology and the many choices it offers, consumers are reluctant to give up the humble cheque book.
Research by Mintel, a leading market research company, has found that two thirds (66 per cent) of bank customers think they should have the choice of being able to use a cheque book.
“There’s a strong conservative streak among the British public, as confirmed by the the outcry and subsequent climbdown when banks tried to withdraw support for chequebooks. But offering cheques costs banks money, and in the end, that costs all of us money,” Toby Clark, head of financial services at Mintel, said in a statement.
“If people had to pay a little extra if they wanted to have the option of writing a cheque, I’m not sure that they’d still be as set on keeping that service going.”
Even with the large numbers of consumers still wishing to retain the cheque book only a small proportion make use of it.
Mintel’s research reveals 21 per cent of the population have never even written a cheque and, in total, less than half (45 per cent) have paid for anything by cheque within the last few months.
Younger people seem to be less concerned with using a cheque book. Some 52 per cent of under-25s have never used a cheque, and a quarter (25 per cent) haven’t paid for anything by cheque within the last few months.
Clark said that “at the moment, consumers are mainly sticking to the tried and tested. Even people who have been issued with contactless cards are more likely than not to ignore the contactless feature.
“However, Mintel’s research shows there’s also huge potential for change. There’s particularly strong interest in many of the features offered by mobile wallets. Payment providers need to prepare for a period of rapid change if they’re not to lose control of the customer relationship.”
One of the reasons for people’s reluctance to accept new payment methods is the fear that they could lead to greater levels of fraud, says Mintel.
Research revealed that over the last five years, while three fifths (57 per cent) agree that they are worried about payment fraud, only about 30 per cent have actually been a victim of any kind of payment fraud.
The most common type of loss is card fraud, with 14 per cent of people saying they have been a victim of this kind of theft.
But paying with new technologies isn’t the only method with risks, says Mintel. They found that, when combined, similar numbers of people had lost money because of theft of cash or receiving forged notes and coins: 8 per cent had had cash stolen, and 5 per cent had lost money as a result of forgery.
“The issue of payment fraud is absolutely central when it comes to convincing consumers to adopt new payment methods. Understandably, people are wary of any change to the status quo, but consumers’ fears are not always grounded in reality,” Clark concluded.
“Notional threats associated with newer technology are often overplayed, while people are prepared to overlook very real security flaws in established payment technologies. But rational or not, these fears must be countered if new payment technology is to thrive.”
Earlier research by Mintel had found that two thirds (62 per cent) of smartphone users and 71 per cent of tablet owners would consider using their mobile phones to make payments if this service was offered by their mobile operator. However, only 8 per cent of UK internet users said they would sign up for the service straight away.
“Although most people are happy with the status quo, there’s also a good proportion of people who are willing to consider new ways of paying. And if anything, people are even more interested in the additional, non-payment, features that the shift to mobile payments could offer—real-time card balances and alerts, for example, or the ability to store discount vouchers on a handset and apply them at the checkout,” Clark said in a statement.
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