A new study from the Pleasanton, Calif.-based Javelin Research + Strategy underlined two facts: digital wallets continue to gain popularity with consumers and, said Javelin analyst Mary Monahan, “This is a fight for credit unions to win—or lose.”
Javelin said that for many consumers, their financial institution is where they want to find their digital wallet solution.
“They trust their financial institutions. Whatever wallet their [credit union] comes up with is the one they will adopt,” Monahan said.
The report also said many financial institutions have lagged in deploying working wallets while non-banks like PayPal and Google have been steadily growing their usage.
“The financial industry narrative is that nobody wants a mobile wallet but that is not true,” said Javelin Research Associate Daniel Van Dyke, a study co-author. “There is a strong incentive to get into this now. The mobile wallet space is not static.”
The Javelin study also revealed the velocity of the market momentum.
“In the past 90 days, 21% of smartphone owners have used a mobile wallet such as Google Wallet or Apple Passbook,” the study said. “When consumers were polled about using a mobile wallet in the future, 30% of smartphone owners (22% of all consumers) said they were likely or very likely to use a mobile wallet in the next 12 months.”
The study also said the most likely age group to target for potential users is Gen Y, which consists of consumers between the ages of 25 and 34. Of that group, the study said 34% said they were likely to adopt a mobile wallet in the next 12 months, compared to all consumers at 22%.
Additionally, the study found that 28% of consumers making more than $150,000 annually are likely to adopt mobile wallets in the next year.
“One in three will use a mobile wallet in the next year and if their financial institution does not offer one, they will go elsewhere,” Monahan said.