BIM400_A4SIME

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1 Assignment 4 Mobile Payments Assignment 4 Nicole Sime Info MGMT in Organizations, National University BIM 400 Info MGMT in Organizations Professor Harjit Singh February 15, 2024

2 Assignment 4 Mobile Payments The recent technological evolution in the telecommunications and wireless sectors has resulted in the emergence of a new payment system, which is believed to solve the problems and shortcomings of traditional or conventional payment systems such as visa card, paypal debit card, credit card, and master card, where it is seen to be present at any time, anywhere, and easy to carry out transactions such as money transfers, purchasing goods, and paying for services, among others. This new creative payment method, known as mobile payment or mobile money, uses wireless devices such as personal digital assistants (PDAs), mobile phones, and other associated digital gadgets. Payment or transaction initiated with the use of a mobile phone or gadget (Wang et al., 2022). These include online banking and payment websites, web browsers, and text messaging. In my opinion, mobile payment may be defined as the process of doing any transaction via mobile devices, which can include purchasing things, paying for services, and any other wireless transactions. The mobile payment ecosystem consists of financial institutions, customers, retailers, and other mobile payment service providers; these financial institutions authorize transaction flow and security. In chapter 6 case study 1, it talks about how in a country where cash reigns supreme and nearly everyone possesses a cell phone, NTT Decomo has spearheaded a huge push into mobile payments and m-commerce. The mobile phone carrier pioneered the use of near field communication (NFC) chips within its cell phones, allowing data to be sent wirelessly across a few millimeters (Wallace, 2020). Subscribers to Docomo's wireless network may pay for cappuccinos at participating businesses by tapping their phones on a dedicated terminal or just waving them around. Mobile payment systems throughout the world differ significantly. In Singapore, for example, retailers display QR codes at the point of sale that customers may scan

3 Assignment 4 with their mobile phones. Purchasers enter and authorize the amount, which is subsequently reflected on their accounts. Direct carrier billing is common in nations where few individuals have credit or debit cards to collect costs from a variety of retailers. The charges authorized by the user on the phone are added to the mobile phone bill, which can be paid with cash. Mobile payments have been slower to take off in the United States, owing in part to credit cards' widespread use and confidence. The credit card business incorporates important fraud precautions while still providing benefits such as cash advances, frequent flier miles, or cash back. Switching to mobile payments would represent a significant change in customer behavior. What are the potential benefits of mobile payment technology for consumers? What are the potential benefits for retailers? Convenience: Mobile payments are quick and can be done anywhere, anytime. “Just with just a few taps on your phone, you can make payments for your bills. The popular payment apps include Apple Pay, Samsung Pay, and Google Pay. You can avoid long lines to pay your bills at the billing counter” (Tiwari, n.d.). Security: Mobile payments often require authentication (like fingerprint or face recognition), making them more secure than traditional methods. Near Field Communication (NFC) technology is used in digital wallets, allowing clients to make transactions at POS stations by tapping or waving their phones. Customer data is secure throughout transactions since payment applications employ encryption or protected code for payments. Faster Transactions: Mobile payments can speed up the checkout process, improving customer experience. To complete your transaction, just touch or wave in front of an NFC terminal. This also eliminates the need to provide sensitive information such as your card number, password, or expiration date when making credit card payments.

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4 Assignment 4 “Mobile payment security is often overlooked leaving businesses vulnerable to attacks that could have a devastating impact on their bottom line. I A previous survey revealed that 84% of organizations reported they were subject to mobile-based phishing attacks — reflecting the lack of appropriate security measures in place when it comes to mobile transactions” (Build, 2023). What are the risks for consumers and retailers? What are some ways that these risks could be over-come? For consumers, the primary hazards are privacy issues and the possibility of fraud or theft. For retailers, risks include data breaches and the expense of installing new technology. Consumers and retailers may reduce risks by employing robust security measures such as encryption and two-factor authentication. These dangers can be mitigated by education: consumers should be informed about secure mobile payment procedures. How could this technology affect the telecommunications and consumer banking industries? “The integration of mobile payments into telecommunication services is beneficial for the industry as well as customers. Telecom companies can increase their revenue opportunities and improve customer experience, while consumers can conveniently make secure payments from anywhere. Telecommunication companies can use mobile payment solutions to make money on currency conversion, processing fees, and accurate geo-targeted ads. With this fusion, telecom companies can be rewarded with broader utilization of communication networks” (February, 2023). Mobile payment technologies may increase demand for improved mobile data services, as transactions need a reliable internet connection. Banks may need to modify their services to be compatible with mobile payment systems. This might drive innovation and competitiveness in the banking business. Do you predict mobile payments will become dominant in the United States? Why or why not? I believe that mobile payments will grow increasingly popular in the United States

5 Assignment 4 owing to the ease and security they provide. However, widespread acceptance will be contingent on a number of circumstances, including consumer familiarity with the technology, the availability of infrastructure to handle mobile payments, and regulatory concerns. In conclusion, Consumers will require additional incentives to try any of these new services, as well as the same level of trust that they already have in credit cards, debit cards, checks, and cash. Convenience is one motivation, but innovative businesses may use additional aspects that link mobile phones to shopping. Aeropostale, for example, provided an app that allowed clients to pick the music played in the store. The teenagers waited for their choices for at least 30 minutes. The lengthy wait provided ample opportunity to shop, and the corporation learnt a lot about its consumers' music tastes. As mobile payment trials progress and technologies improve, queues at checkout counters may become significantly shorter.

6 Assignment 4 Reference: Al-Qudah, A. A., Al-Okaily, M., Alqudah, G., & Ghazlat, A. (2022). Mobile payment adoption in the time of the COVID-19 pandemic. Electronic Commerce Research , 1. https://doi.org/10.1007/s10660-022-09577-1 Build. (2023, January 16). Top threats of digital payment: 5 mobile payment security threats every business should be aware of . Build38. https://build38.com/digital-payment- security-threats/ February. (2023, February 17). Rise of mobile payment solutions and its impact on the telecommunications industry . VoIP Business - VoIP Business; VoIP Business. https://www.voipbusiness.com/blog-post/rise-of-mobile-payment-solutions/ Tiwari, T. C. (n.d.). The benefits of mobile payments and why it’s the future . Plumpos.com. Retrieved February 19, 2024, from https://plumpos.com/blog/the-benefits-of-mobile- payments-and-why-its-the-future.html Wallace, P. (2020). Introduction to Information Systems (4th ed.). Pearson Education (US). https://online.vitalsource.com/books/9780135868126 Wang, M., Ling, A., He, Y., Tan, Y., Zhang, L., Chang, Z., & Ma, Q. (2022). Pleasure of paying when using mobile payment: Evidence from EEG studies. Frontiers in Psychology , 13 . https://doi.org/10.3389/fpsyg.2022.1004068

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