Many consumers do not fully understand the concept of a digital wallets, and a majority are concerned about their security.
These were some of the findings of comScore's study, Digital Wallet Road Map 2013, which measured the consumer awareness, perceptions and intent to use digital wallets.
Digital wallets store the virtual information found in a consumer's physical wallet to facilitate online retail transactions.
The overall concept of a digital wallet is hard to comprehend for a high number of consumers. Respondents in the study scored an average of just 45 percent in terms of demonstrated level of understanding.
Security is the major concern with consumers. 93 percent of consumers would prefer to use a digital wallet that has to be unlocked before use.
Many competitors have entered the digital market industry, but it is dominated by PayPal. 72 percent of respondents were aware of PayPal's digital wallet while only 51 percent said they are aware of any other wallets. Just 12 percent of respondents have used a digital wallet other than PayPal; for these remaining 88 percent, only 38 percent they'd likely use a digital wallet in the future, 27 percent said they were unsure, and 23 percent said they were unlikely to use digital wallets.
"Low awareness, understanding of benefits and availability among retailers are among the key barriers to adoption of digital wallets. While these impediments may seem like a steep hill to climb, we have seen this story play out before in the financial services industry. There was a time when consumers were reluctant to use ATMs for similar reasons, and, today, look at how far we've come since the 1970s and 1980s," said Andrea Jacobs, comScore Payments Practice Leader.
The study was based on a panel of one million U.S. consumers and two additional surveys of more than 2,000 Internet users in the United States. It was conducted in November 2012.