Bitcoin has no real advantage over credit cards, assuming the bitcoin processor (and there will be a middleman - not everyone is going to run a digital wallet) offers the same level of service. Credit cards cost a lot, because of fraud protection.
Now, maybe the banks are getting fat and lazy, and some new entrants will stir things up a bit. A secure token (maybe an app) could cut the costs of fraud protection, but I can't see how bitcoin can work better. Sure, you can have a 20 character password on you bitcoin collection. But there's no reason why banks couldn't give consumers the option of doing the same (a 20 character pin on a app, which validates transactions), if there was much demand for it.
There is no concept of chargebacks with bitcoin, so transaction costs can be kept lower. As the industry matures, I predict fraud rates in line with debit cards/ACH transfers.
Now, maybe the banks are getting fat and lazy, and some new entrants will stir things up a bit. A secure token (maybe an app) could cut the costs of fraud protection, but I can't see how bitcoin can work better. Sure, you can have a 20 character password on you bitcoin collection. But there's no reason why banks couldn't give consumers the option of doing the same (a 20 character pin on a app, which validates transactions), if there was much demand for it.