Hotels Turn to Digital Wallets Amid Key Card Security Worries

Just as plastic cards replaced metal keys at hotels, digital wallets are replacing key cards.

As CNBC reported Sunday (Sept. 1), this shift follows a tough stretch for plastic hotel key cards, thanks to health concerns during the pandemic and cybersecurity worries more recently.

That’s led Google and Apple to begin offering hotels the ability to allow guests to save their room keys to their digital wallets, letting them enter their rooms just by tapping their phones against a reader next to the door handle.

And the Hilton hotel chain, meanwhile, offers the Honors app, which lets guests check in and use a room key through their smartphone.

Eli Fuchs, regional director of operations at Valor Hospitality Partners, which counts Hilton and Holiday Inn Express hotels among its portfolio members, told CNBC that digital is the next phase in hotel room door technology.

“Traditional hotel room keys are staring down the end of their existence,” Fuchs said.

However, some security experts caution that even the newer lock methods aren’t foolproof.

Lee Clark, cyberthreat intelligence production manager at Retail and Hospitality Information Sharing and Analysis Center, told CNBC that while threats can be mitigated by security protocols like multifactor authentication (MFA), guests may not want to deal with extra steps.

Clark added it’s unlikely that all hotels will replace all key cards with digital keys in the short term. Aside from the costs, some guests might rather have a key card, or may not have a mobile device compatible with digital lock systems.

“Transitioning to digital and keyless lock systems carries a significant cost in equipment, installation, maintenance and security,” Clark said.

As PYMNTS wrote earlier this year, while a majority of consumers use digital wallets for shopping, a considerable number turn to them for other things.

For example, research by PYMNTS Intelligence — from the study “Digital Wallets Beyond Financial Transactions: A Global Perspective” — finds that 29% of consumers would use the technology for age or identity verification; 28% to store and access rewards, discounts or coupons; 25% to store and access event tickets. Another 24% said they use digital wallets to store and access financial documents or information.

“Data suggests that familiarity with digital wallets is the key bridge to cross for engaging new users, and even a portion of those skeptical today could become the digital wallet users of tomorrow,” PYMNTS wrote in the study.