The Rise of Digital Wallets

Instant. Easy. Fast. Cashless. Low fees. Digital. Global. Money.

What comes to mind when you hear the words “digital wallet”? The way we interact with money has changed dramatically over the last few years (eg. cash vs. cards) and technology is driving the cashless and even cardless environment we see ourselves in today. So how are digital wallets facilitating this transition?

The growth in digital wallet usage is a global trend. All mobile users making a transaction using their devices have the same story to share. In the United States alone, 57 percent of users (which amounts to 60 million people) have used a mobile wallet at least once. In Australia, 72.4% of Aussies are using at least one form of digital payment, with adoption tipped to rise as society edges towards a cash and cardless environment.

The reason for the growth in usage is simple. Having one destination to makes transactions, quicker and easier, removing the arduous process of adding a beneficiary every time you have to make payment, is very appealing. The technology is quickly becoming the most used element of the FinTech Industry.

 

So, how do you compare digital wallets?

Digital Wallets should be a personalised portal for you, so following are some features when considering joining to the digital wallet movement:

  • Security. Ensure that your Digital Wallet has a number of security measures in place such as encryption for every transaction, zero liability protection or some insurance for your purchases. Safeguards should also be in place to only bill you once if you tap twice by mistake. Consider setting up a username, password and PIN.
  • Payment method. Your Digital Wallet should utilise NFC for easy payments that are quick and convenient. You may also be able to pay your friends and family easily by bumping your devices together or electronically transferring funds. The Digital Wallet should be able to make bill payments on behalf of the user and schedule any bills payments when their due.
  • Online shopping. If you regularly buy online, it may be a good idea to use a Digital Wallet that is accepted at your favourite online retailers. You can avoid entering your credit card details every time you buy on the Internet and instead just enter a username and password. Check the merchant or partners page of the Digital Wallet to find out what they are.
  • Rewards. You may be able to link your rewards program with your Digital Wallet, so it may be able to give you real time reporting of the number of points you’ve accrued over loyalty programs. If you are a member of multiple rewards programs, remember to link all your cards to you Digital Wallet.
  • Organiser. Your Digital Wallet could store your calendar, contacts, tasks, lists and personal information, allowing you to access them at anytime. This makes it easier to update and retrieve the information you need when you want to, as well as easily sync your information to all your devices.
  • Technology. Contactless payments are the new standard for Digital Wallets and facilitate things like PayPass or PayWave. It uses Radio-Frequency Identification (RFID) tags to add a security layer that lets secure transactions through an enabled device. New Digital Wallets could incorporate things like computer chips and Point of Sale (POS) device that provide a better and smarter shopping experience for you.
  • Financial institution. Many banks and other financial institutions are integral to the Digital Wallet movements as they facilitate your payment. Your financial institution may already have an app available for you, which will make your digital payments easier as they already have your account information.

 

Are you using a Digital Wallet you would recommend? Share with us below.

 

Source: TechGenix, Rise of Digital Wallets and What They Mean for the Fintech Industry