The use of credit and debit cards is set to dwindle over time with more consumers using cell phones as the preferred method of making payments via the use of new technology, which removes the necessity of swiping a card, according to Deloitte.
“It is obviously farfetched to think that the use of debit and credit cards will be completely eliminated, but a time will come when you open a bank account, you will be asked to choose between having a card or a phone (as a means) to pay,” says the Deloitte consulting technology division’s digital marketing lead executive, Jonathan Houston. Houston says that the fast convergence of banking and cell phone technology that began with functions as simple as money transfers are increasingly turning the cell phone into a new kind of virtual bank.
Banking technology and products that use cell phones have already undergone widespread testing in places such as South Africa, which was an ideal market thanks to an estimated 11 million unbanked and under-banked population. With rival companies launching competing versions of the same basic technological idea, Houston says that retail payment systems could end up being made redundant as cards issued by banks slowly but surely start to become fade into obsolescence.
The chief executive officer of First National Bank, Michael Jordaan, has also gone on record, as saying that he believes cashless payments will become the norm eventually.