If you believed the publicity from banking innovation experts in the late 2000s you’d be quite surprised that cash isn’t dead and we’re not paying for everything by tapping our phones against little black boxes.
A few years on and there has certainly been some movement in that direction. There are some cool phone payment systems (square) and some quite widely used card tap payment systems (paypass).
However, it’s not exactly been the lightning revolution that was promised. We’ve been hearing about google wallet since 2011. Where is it? I’m still handing over a jangle of coins for my morning flat white.
Where I live (Australia) we are certainly not a luddites. Whilst we have traditionally lead the world in uptake of new payment systems, the number of payments made with cash was actually increasing at least until 2010. There seems be have been a gentle drop since them, but it’s not exactly falling off the chart and, where I come from, still dominates other methods of payment at low amounts:
So, what’s stopping us? Technologists would probably argue that the implementation of the required infrastructure. But I think the real issue is ourselves. Or more specifically, our habits.
You see, it’s my belief that most of our interactions with money are based on habits. This is especially true when you think about payment methods. We simply don’t think about it. Therefore, no matter how cool the new world of payment excites tech heads and designers if the bridge is too far from what each broadly standard habits they won’t take hold.
People didn’t one day move from using paper and metal currency to tapping little pieces of plastic against a curved black box and hearing a ‘beep’. There was a progression:
The reason that google wallet isn’t taking off (just yet) is that it’s just a habit too far. Tapping our phones against boxes with the insignia of a tech company (ie not a “bank”) isn’t scary. It’s just unusual.
It seems a few people are holding a similar view. Some of these people are actually capable of delivering a product to market. My favourite example is the impeccably designed Coin; an interactive credit/debit card. Rather than carry all your cards you carry one and use an interface to select which one you want to use.
The CEO and founder of Coin once worked at PayPal. From what I can interpret he helped to build payment systems on mobile phones. He came up against the the chasm of current behaviour to what PayPal was trying to do. He started Coin to not only fit in this gap but adapt with the habitual changes it could create. In an interview he stated:
“I learned a big lesson from my last company where I built a payment system purely on mobile phones. What I found was it didn’t scale, we couldn’t change people’s habits. With Coin we have a system that works now. It works today but it has the technology for tomorrow so it will fit where we’re headed into the future.”
Another interesting example of using habit transition is square. Originally they took the natural behaviour of swiping a card and mashed that with 3 tiny but important behavioural changes:
- Paying peer to peer with a card.
- Paying with your phone.
- Paying via an intermediary that isn’t your bank.
Square played in this space specifically to capitalise on existing behaviours (ie the swipe of a card). But what is really interesting is that they have a succession plan. Square cash capitalises on the newly formed behaviour of paying with your phone through square as a way of removing the card.
The last example is Google Wallet itself. Google just recently announced that they were releasing a debit card. Some thought this was a strange move. But I prefer to think that there was someone like me inside the google wallet team who said “the habitual behaviours people have are on 1 shore. Google wallet is on the other. We need to build the bridge in the middle.” That bridge is the card.
So, what does all this tell us about the design of money? We should dream far into the future. This is where we get the great ideas. But we cannot design this future immediately and expect it to happen.
We must recognise the habits that people have and gradually change them to the more grandiose original vision. The design of money can be a fast evolution, but it will never be a revolution.