digital wallet solution and business make it a vital part of their strategy, it is safe to say that the digital wallet revolution will stick around for several years to come.
Mobile has become an inevitable and indispensable part of our routine. Smartphones are transforming the way we transact in our day to day lives. From paying utility bills to purchasing clothes online and transferring money to our friends in need, digital wallets have made online transaction breezy. While every mobile-savvy consumer continues to use digital wallet solution and business make it a vital part of their strategy, it is safe to say that the digital wallet revolution will stick around for several years to come.
With that said, a forecast by Business Insider indicates that the mobile payment volume will increase up to 503 billion dollars by 2020 in the U.S. alone. 56 percent of the U.S. population is expected to make use of digital wallets in the next year. For every online selling business today, the digital wallet is the way to go and while its future is in flux and businesses must consider re-evaluating their technophobias. The reason being the finance industry presents a lucrative opportunity to embrace mobile payment, cryptocurrency, many other digital money opportunities that will only make consumers’ lives less cumbersome and more streamlined. But first, let’s dive into understanding the definition of a digital wallet.
What is a Digital Wallet?
Digital Wallet, also referred to as e-Wallet, is an online service or electronic device that lets an individual perform a financial transaction. A digital wallet is a replica of a physical wallet that is digitally connected to a debit or credit card or other online services via smartphones.
Apart from transacting via debit/credit cards, digital wallets can store information associated with consumers’ debit/credit cards, prepaid or bank accounts, loyalty cards, health card, and driver’s license. Digital wallets can be used for making an in-store purchase through Near-Field Communication (NFC) or other digital applications.
The Significance of a Digital Wallet for Your Business
The idea of a digital wallet first originated when David Chaum, an American cryptographer, invented digital cashback in 1983. But this concept gained momentum in the ’90s. Thanks to the internet and technological advancements. The launch of PayPal in 1998 further accelerated the mode of digital payment.
In the mobile era, it has become all the more important for businesses to adopt digital wallets. Mobile users are all around and except businesses to serve them where they are. Digital wallets allow consumers to replace carrying their physical wallets everywhere they go. This means they no longer have to deal with the hassle of forgetting their cash, credit cards, or ID proofs back home. They can purchase goods using their smartphones. And it’s unlike for a consumer to leave home without their mobile phone.
Furthermore, using digital wallets can help consumers save time. Instead of carrying cash or inserting a card into an EMV machine, the customer can simply swipe and go. As long as you have a digital wallet with you, make payments online while on move. Besides, digital wallets offer perks such as cashback, rewards, promotions, and discounts. Most essentially, digital wallets are all about consumer convenience. Whereas businesses have instantaneous access to funds. They can save money by eliminating third parties or spending over an expensive Point of Sale (POS) system. They facilitate real-time data, enhanced consumer experience by enabling quick and secure payment methods.
Benefits of a Digital Wallet
Keeping a record of cash-based expenses can often be tedious for customers and business organizations alike. It may further lead to discrepancies in finance management. Digital wallets eliminate the hassle of recording paper-based expenses and dealing with many third-party services through real-time data tracking for every transaction. This gives users greater visibility into their daily spends and lets them track expenses on day to day basis.
Unlike the physical wallet, a digital wallet has secured access and controls. If you enable the security controls on your smartphone, only the authorized people will be allowed to access your phone. In case of a physical wallet, if someone finds it, they may steal your cash and cards from the wallet. But if someone finds your mobile phone, they cannot access your phone or your payment information stored within. Also, when you make a payment in-store or online, the system generates a unique transaction number or token which the stores record for future reference instead of the payment information. This enhances the security of your payment information.
Leveraging digital wallets for your business ensures consumer convenience. Digital wallets are the future of payment. So, partner with a proficient mobile app development company now to integrate digital wallet and get an edge over the market competition. What are the other reasons that make digital wallets imperative for business success today? Share your thoughts and views with us using the comments area below.