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Why we're banking on new wallet service: Wells Fargo executive

Michelle Fox
Updated
Why we're banking on new wallet service: Wells Fargo executive

Wells Fargo (NYSE: WFC) is banking on the future of mobile payments, announcing on Tuesday its Wells Fargo Wallet will be available for Android customers this summer.

The bank's customers can already make purchases through Android Pay, but the new wallet will bring convenience to millions of new customers, said Jim Smith, head of mobile and online channels at Wells Fargo. There are currently more than 5 million Android customers using the bank's mobile app.

"Different customers are going to choose different solutions and we really want to support our customers with the payment options that they want," he said Tuesday in an interview with CNBC's " Closing Bell ."

In fact, research shows that 50 percent of smartphone users actually prefer a wallet from their primary bank, said Smith.

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Smith certainly isn't discounting the benefit of wallets from Android (NASDAQ: GOOGL), Apple (NASDAQ: AAPL) and Samsung (Korea Stock Exchange: 593-KR). About 2.8 million customers have already downloaded payments into those systems, and there has been 88 percent growth in active users over the last year, he pointed out.

And he still sees more expansion ahead. According to a recent Federal Reserve study, 28 percent of all smartphone users made a mobile payment in the 12 months prior to the survey. Of those smartphone owners who have a bank account, 53 percent used mobile banking in the 12 months before the survey.

However, while plastic credit cards may become obsolete, he believes it will take longer than many expect.

Until then, there will be more and more opportunities to take advantage of the technology to make it easier for customers to make banking transactions.

"The more you can do to make it easy and convenient for customers to make their payments that they do every day, the better off they're going to be and you will see adoption," said Smith.

— CNBC's Brian Donlon contributed to this report.



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