On July 3rd, Felix Salmon wrote a piece on why he thinks mobile payments will never take off.  As a consumer in the current marketplace, it might be easy to agree with his thoughts.  Haven’t we been talking about mobile payments for years?  Shouldn’t I be able to pay with my phone everywhere by now?

In technology, there is always an assumption that change and disruption happens quickly.  When you’re dealing with fragmented POS hardware providers, VARS, banks, ISOs, smartphone carriers, smartphone hardware manufacturers, and more, change is a process.  ISIS and Google Wallet went all-in on NFC and later realized, like the rest of us and TechCrunch, that Nobody F***ing Cares.  LevelUp started with non-integrated scanners and local merchants in a few cities, and have now integrated with the major POS companies like Aloha and Micros.  Pay With Square is limited in scope because of its pairing with the Square Register, but they have found scale in with large partnerships with Starbucks and others.

But along with these tests come realizations: the QR code is the least common denominator and therefore best current use case for mobile payments.  Mobile payments without built-in offers, loyalty, incentives, or rewards will struggle to gain adoption because the status quo, cash and credit cards, is not an inherently broken experience.

Salmon uses the following arguments to shovel dirt over what he perceives to be a mobile payments casket:

1.  Paying with your phone is harder than plastic.

To argue this point, he uses sparse anecdotal evidence of failing to get Square Wallet to work a couple times.  I find it more tedious and time-consuming to whip out your loyalty card, then your credit card, and then wait for the receipt which you put in your pocket.  Most mobile payments offerings combine payment, loyalty, and receipt into one action, saving the customer time.  Through research, we have found that closing a transaction with a credit card takes 11 seconds, while a QR code-based mobile payment takes on average 7 seconds.  QR can achieve speed and simplicity.

2. I get self-conscious or embarrassed to pay with the phone

While it is true that one mobile payment experience with an awkward, untrained cashier can create apprehension in subsequent visits, I challenge anyone to watch a line at sweetgreen or Starbucks for 20 minutes.  At Starbucks, 10% of their customers pay with the phone.  At sweetgreen, they have achieved twice as many people paying with their app.  Those paying with their phones are almost always excited to do so, as if paying with the phone is a holistic, positive experience.   I’ve talked to Starbucks app users who now go out of their way to visit Starbucks because of the app’s ease of use.  Still, the uneven experience needs to be tackled.  Deeper POS integration and ubiquity will do a long way towards solving any stress people may have flashing their phone at a register.

3. There is no incentive to switch – a few cents off a macchiato isn’t enough

If a caramel macchiato costs $4.00 at Starbucks, a 10% loyalty construct could save Felix $0.40 per day if he becomes loyal to that coffee shop.  If he gets a macchiato every morning, he would save around $100 each year from the loyalty program.

Surface-level discounts are just the tip of the iceberg when it comes to savings over time.  Merchants can now target customers for discount, so paying with your phone just once at your local coffee shop or regional fast casual chain can put you in line for a re-engagement offer or birthday gift down the road.

4.  In less developed Africa, paying with M-Pesa and Zaad is becoming popular because they are more convenient and more reliable than paper currency

I respect this argument.  In less developed countries where paper currency fluctuates and building a credit card-based infrastructure is too expensive, mobile payments will certainly drive faster adoption than in developed countries with more stable currencies.  Money transfer is difficult and even broken in many countries, in stark contrast to the United States.

Good enough isn’t good enough.

Five years ago, purchasing books at your local Borders was seen as “good enough.”  Ten years ago, having a Nokia brick phone was viewed by many as being “good enough.”  If the status quo in payments is being deemed “good enough” by the public, it’s a clear indicator of opportunity.  Innovating payments is naturally difficult and slower moving, but as success is found scale will occur.  For a taste of what’s to come, check out this infographic on the near future of mobile payments.