Time Is Money: The Growing Popularity of Smartwatch Banking

by on Oct 04, 2018

In August 2017, Fitbit introduced Fitbit Pay alongside its Ionic smartwatch. Three days later, Garmin followed suit with Garmin Pay, which it announced with its Vívoactive 3 smartwatch. Fitbit Pay and Garmin Pay allow smartwatch owners to access their checking accounts via their smartwatches for in-store purchases. Since the introduction of these payment services, seven of the 18 banks covered by Corporate Insight’s Bank Monitor have been gradually integrating these apps.

Research suggests that these firms are part of a critical trend. According to a CCS Insight report, 71 million smartwatches will be shipped in 2018 and the figure is expected to nearly double by 2022. Currently, the wearables market is dominated by the Apple Watch utilizes Apple Pay, the now ubiquitous service that is already supported by most major banks, including all 18 banks covered by Bank Monitor. Apple Watch, though, is dependent on its integration with the iPhone and iOS—a roadblock for non-Apple users. Even the recently released Apple Watch Series 4, which has its own cellular technology, is incompatible with Android phones. But Android users make up the majority of smartphone users, so represent a large untapped market of potential smartwatch owners with no use for Apple Pay. It is this market which is best serviced by Garmin Pay and Fitbit Pay.

These apps have potential for activities where carrying a wallet or phone is a nuisance, like jogging or playing competitive sports. With physical activity growing in popularity among Millennials, the widespread adoption of these smartwatch apps is a likely development for people looking to purchase items like post-workout snacks or drinks.

So far, banks vary in how they promote the new apps. SunTrust and PNC include descriptions and introductory step-by-step guides on their sites, while other firms, like Bank of America, Wells Fargo and Chase, link to the third-party Garmin Pay and Fitbit Pay sites. The latter option creates an unnecessary hurdle for bank customers who want to learn how to use these services. This is especially true for Fitbit users, as the Fitbit Pay website does not include a how-to guide or graphic.

SunTrust Garmin Pay Page

PNC Garmin Pay Page

Banks that have elected to make their accounts compatible with Garmin Pay and Fitbit Pay leave room for improvement in their promotion of the new apps. Only some of these firms have public site pages dedicated to the services. Early adopters have an opportunity to move ahead of the competition in this market—a market which appears to be growing—and can capitalize on it by making the customer experience as clear and useful as possible.