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Credit cards, shopping and crystal balls

by Peter Andrew

Every so often, we in this corner of cyberspace give our readers a heads-up on technologies that are affecting -- or may soon affect -- their experiences when shopping or using their credit cards. Sometimes, we get things spookily right. Just weeks before Edward Snowden began his odyssey around some of the world's most oppressive and instrusive regimes, we highlighted in Big data: Who is watching your credit card use? how government and businesses are using big data to spy on citizens and consumers.

Admittedly, we missed the NSA off this list, although we would have included it, had we happened across the May 2006 USA Today report that began: "The National Security Agency has been secretly collecting the phone call records of tens of millions of Americans, using data provided by AT&T, Verizon and BellSouth, people with direct knowledge of the arrangement told USA TODAY."

In-store privacy invaded?

Apparently, some big retailers are using cutting edge technology to better understand the attitudes and behavior of shoppers in their stores. Some of those technologies -- even ones that aren't linked to your credit cards -- are either seriously scary or seriously cool, depending on your perspective. One can intercept unique signals given off by your smartphone, allowing it to recognize whether you're a first-time or repeat customer, and to monitor your visits. Another can use your smartphone to track your progress round the aisles, noting where you pause and for how long. A third uses advanced cameras and applications to identify whether you're a man, woman or child -- and even to make an educated guess from your facial expressions as to your present mood.

Intrusive? Maybe: certainly many Nordstrom customers thought so, and their complaints led the company to end its particular smartphone-tracking experiment. But deploying even the most advanced of these technologies is likely still to leave the brick-and-mortar retailer knowing less about you than an online counterpart such as Amazon. You see? Most of us are inconsistent about privacy.

Will mobile payments take off?

In PayPal boss: You want to lose your wallet, we discussed last month the existential threat that new digital wallets (when you make a cardless transaction using your smartphone, tablet or similar device) might pose to credit card companies. It seems others agree. On July 8, PitneyBowes published a white paper aimed at card-issuer executives that suggested five ways they could counter that threat. For its readership (and for you, if you like your credit cards), the paper's opening paragraph was apocalyptic:

The business of consumer credit is on the verge of a seismic shift… Alternative digital delivery, including online and mobile, is on the rise. A new type of aggregator, the digital wallet, is gaining traction with merchants and consumers alike. And now, fifty years after the first plastic credit card was issued, the possibility that plastic will soon become a thing of the past, looms.

If that stirred some regret in you, you might be comforted by a Reuters piece that appeared on July 5 under the headline Why mobile payments will never take off. In it, Felix Salmon argues that digital wallets and similar services are, if anything, less easy to use than plastic cards, so consumers will never adopt them en masse. Well, maybe. But, if you're old enough, you may remember commentators saying that few consumers would ever want cell phones. And Mobile Commerce Daily (though you may think, with a name like that, this publication has a dog in this particular hunt) believes digital wallets should yet find favor among Americans, once marketers get serious about educating the public and some technical issues are resolved.

The world moves on… and on

Your chances of changing the future of the world by making a stand against the current tidal wave of new technology are slim. But it's worth remembering that most new technologies create losers as well as winners: the person who resents intrusive surveillance alongside the early adopter who loves his or her new toys; the consumer who (if PitneyBowes is right) is going to miss generous rewards credit cards alongside the retailer who welcomes cheaper ways of accepting payments. Let's hope you're one of the winners.

Published 07/22/13 (Modified 11/20/13)

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