Digital currencies now feature in the long-term strategies of US businesses, according to a new study of electronic payment trends.
Additionally, 80% of the 634 US residents surveyed said they expect digital currencies to overtake paper currencies in the future.
The report’s authors point out that the participants, primarily working in IT operations, security and technology deployment, are “all familiar with and involved” in their organisations’ electronic payments practices.
In addition to digital currencies, the report also deals with security, authentication systems, emerging technologies, wireless standards such as Near Field Communication (NFC) and mobile services like Apple Pay and Google Wallet.
No shortage of interest in bitcoin
Overall, the report indicates that perceptions of new electronic payment systems are positive and digital currencies have their fair share of support.
Looking at the take-up of bitcoin generally, the report asked: Does your organization support or plan to support a virtual currency innovative electronic payment solution (such as bitcoin)?
In total 79% of respondents replied yes, although the majority planned to do so more than a year from now. Fourteen per cent had already adopted digital currency, and 20% planned to within the next six to 12 months.
While digital wallets proved to be popular, respondents expressed concerns about security risks. Indeed, the single biggest barrier to adoption of innovative payments technologies is security, the report says.
The report concludes that widespread adoption of digital currencies is “inevitable” because both companies and consumers are willing to embrace them.
In total, 60% of respondents said digital currencies are an important part of their organisation’s electronic payment strategy, with 26% saying they “strongly agree” with that statement.
Respondents were particularly bullish on mobile payments and 75% confirmed their organisations plan to offer support for mobile payments in the near future, while 59% said they will integrate support for stored value cards.
Digital currencies came in third, with 43% of respondents saying they will play a part in their mobile payment strategy.
When asked whether digital currencies will overtake paper currencies in the future, the majority of respondents said yes.
Most expect this to occur within 5-10 years and only 20% of those surveyed said this would never happen.
A similar trend is visible in digital wallets, but respondents expect adoption to be somewhat faster.
24% said they would adopt digital wallets over the next two years, while a further 56% said they would do so over a 5-10 year period.
For the time being, support for digital currencies remains limited. Just 14% of respondents said their organisations support digital currencies already.
Interest is picking up, however. 11% of respondents said they plan to integrate support over the next 6 months, while 9% expect integration over the next 12 months.
Many of those surveyed (45%) said their organisations intend to roll out support for digital currencies more than a year from now, while 21% said there were no plans for support.
When asked how important the acceptance of paperless or virtual currencies (such as bitcoin) is to their organisation’s innovative electronic payment strategy, 40% of respondents said it was essential, while 43% described it as “very important”.
Only 11% described digital currency integration as “somewhat important”, followed by 6% of respondents who said it was not important. None of the respondents described it as “irrelevant”.
Security challenges remain a big concern
New payment models also bring new security challenges and most respondents said one-time passwords or tokens will be the most important approaches, followed by federated identity and authentication systems and multi-factor authentication.
Digital currencies are associated with a number of specific security concerns that may or may not affect other forms of payment.
When asked whether the acceptance of digital currencies would increase or decrease the security and integrity of electronic payments, the majority of respondents said it would result in a decrease.
The majority (42%) said they expect a decrease, while 41% said digital currencies would result in a ‘significant decrease’.
Just 2% expect a significant increase and an additional 5% expect an increase, while 10% said digital currency adoption would have no impact on security.
It should be noted that these concerns are not limited to digital currencies, as most respondents also said digital wallet integration would have a negative effect on security.
Digital wallets fared somewhat better than digital currencies, but 34% of respondents still said they would bring a ‘significant decrease’ in security, while 37% said they expect a decrease.
Business survey image via Shutterstock