Our credit cards articles, reviews and ratings maintain strict editorial integrity and are independent of whether a card is an advertiser (they are neither commissioned by nor reviewed, approved or endorsed by issuers); however we may receive compensation through the issuers' affiliate programs when you click on links to products from our partners and get approved. See details on how we make money here.
Someday, the conventional wisdom and statistics keep telling us, we're all going to throw out our wallets and replace them with digital phones. As The Los Angeles Times recently reported, quoting numbers from the research firm, Gartner Inc., by 2016, payments over mobile phones will reach $617 billion worldwide, up from last year's $105 billion.
Then the Times' David Sarno wrote: "There are big advantages to electronic money. It's easier and quicker to process than cash or plastic, and without the need to fish around for credit cards or wait for receipts to print, long lines may become a thing of the past."
With all due respect to Sarno, I couldn't help but chuckle at that. I'm all for progress, and if someday, I'm only carrying around my credit cards digitally ensconced in my phone instead of my wallet, that's fine. I won't weep or look fondly at photos of my wallet (photos on my smartphone, of course). I'm not a Luddite. But I am sometimes a curmudgeon, especially if it comes in handy in writing a blog post, and I see a few ways that having a digital wallet might complicate my life just as much as having a leather wallet has.
Complication #1: I might have left it at the zebra enclosure
Just as I can lose my wallet, I can lose my smartphone, too. In fact, chances are better that I will lose my smartphone than I'll lose my wallet. My wallet, I tend to keep in my back pocket when I'm out, only pulling it out shopping. A cell phone, you're generally whipping it out to take photos, to ask how to get from one place to another, play games or whatever, which means the odds are better that you're going to set down your phone somewhere and forget to pick it up. According to the mobile security firm Lookout Labs, Americans lost thirty billion dollars' worth of mobile phones last year.
Complication #2: Maybe I don't need a karaoke machine
The easier and faster we make it so that we can spend money, the more likely I'm going to walk out of the store with even more impulse purchases and an even smaller bank balance or higher credit card debt to pay off, or walk out of the store without buying what I need. I don't like long lines any more than the next person, but I have to admit, there have been some times when standing in a line that I've realized something I bought is something I don't really need, and I can hand the clerk the item and get the rest of whatever's in my cart. Or likewise, many times I've been in line at, say, the grocery store, and I suddenly realize I didn't buy the paper towels I came to buy, but instead bought half a cart of, well, everything else -- and then I can excuse myself from the line and race back and get those paper towels.
You have to admit, that checkout line we all love to hate is sometimes a useful buffer that can prevent us from making stupid purchases or making no purchase at all. I know that someday when the smartphone takes over, I'm going to run to the store, quickly buy a bunch of items, and be halfway home when I'll suddenly realize I didn't buy what I went to the store for. Just like I do now.
Complication #3: I should have bought the insurance
If I drop my wallet when I'm shopping, it isn't going to break. If I drop my smartphone… oh, I know. I sound like I'm stretching for one more example to make my point, but you know, last year, on a vacation at the beach with my kids, I forgot that my cell phone was in my swimming trunks' pocket, and two waves later, I remembered. I managed to get through my vacation pretty well without the cell phone; I couldn't have without a wallet. If my wallet had gotten wet from the same waves, I'd still have had some perfectly good credit cards at my disposal, my driver's license and so on.
I guess what I'm saying is that while I think the smartphone technology is cool, and the idea of a mobile wallet is a fun one, I really don't think digital wallets are going to replace many of our hassles of shopping. We may not have to dig into our wallets for a specific credit card, but we'll probably increase the odds we press the wrong button and pay for something with the credit card we use for emergencies instead of the one that offers the best rewards. Instead of worrying that a pickpocket is about to get our wallet or purse, we'll just worry about them filching our smartphone.
I'm excited about the future, but not all that excited about how a mobile wallet and digital money is going to change how I shop. I expect a lot of old annoyances and irritations of the past to come along with us, along with a few new fresh ones.