Digital Wallets-Types, Ideas, and Future of Such Products
Introduction
An E-wallet is an electronic wallet that is used to transfer money online through a smartphone or a computer. An E-wallet account is linked with the user’s bank account to make payments. Here in this blog, we are going to talk about e-wallet applications which lets people store electronic money. But before we talk about the advantage of e-wallet, an individual must need to set a password to access the stored electronic money to make online transactions safe.
The e-wallet has only two basic components
· Software and strong encryption.
· User’s data including name, bank account detail, card details, and a government document.
Benefits of Digital Wallets
Simplified payment process: With the help of e-wallets, an individual can quickly transfer the amount for the product or service in the store. As you have experienced yourself, transferring money through plastic money is a complicated process, since it requires you to enter the CVV, card number, and OTP number.
Unlimited period of use: Once an individual sets up their account in the system of digital payment service, he can use it as long as he wants to with no time restriction.
Convenient work in the online mode: Money transfer through an online mode is an optimal solution for freelancers, small scale start-ups who crack deals online.
High transaction speed: Sometimes when you transfer money through the bank, it takes several hours or days. The online transactions with e-wallet confirm the transaction within a few minutes.
E-wallet features are:
1. Robust secure user account with all the basic information for making digital payment secure through mobile phones.
2. The features that help you select the currency type (this also includes cryptocurrencies).
3. The e-wallet withdrawal and credit amount limits.
Disadvantages of e-payment services
It is not fully available worldwide.
Undoubtedly, there are various other cashless payment methods that retailers across the countries used. But still, digital wallets are not available on some retailer’s phones, especially in urban areas. Many e-commerce platforms don’t provide online transactions through e-wallet and because of which customers need to submit their debit/credit card details.
It still requires you to carry something.
Though digital payment methods provide more flexibility to the users, but it makes you dependent on your mobile phone. If you don’t have smartphones, you can’t make a payment. Because these e-wallets don’t collect your ID and other information, then you are forced to carry a traditional wallet with yourself.
It doesn’t eliminate your security risks.
The security of your devices depends on the e-wallet platform you are using or on the mobile phone’s setting. If your device isn’t protected with a password, then someone could easily access your bank account or transfer amounts into another account. There are several security technologies available that make e-wallet more secure and beneficial, but still, there are chances of miss-happening.
It may charge you more to process payments.
Most of the e-wallets offer reward programs and cashback. To use these benefits and perks, these platforms charge fees. You need to make payment specifically to get these rewards and cashback amounts. In the PayPal debit program, consumer users get 1% cashback after the completion of payment. If you are using a protected pin in a digital wallet, you can get this perk as you’re changing how the point-of-sale treats the transaction. For sure, you spend $900 per month, you’d lose $100 each year per year for the accessibility of the payment method.
Types of e-wallets by delivery technology
There are numerous digital payment methods, and we’ll talk about them along with this, we’ll also discuss the e-wallet operation scheme. In between, we’d like to discuss some aspects related to delivery technology.
NFC technology
NFC stands for Near Field Communications. The principle of technology lies in the data transmission between close location devices: between a smartphone/ credit card and reading terminal and so on.
We are here talking about the contactless payment method which lets us make payment through our smartphone- instead of plastic money. Some examples are Amazon Pay, Google Pay, and Samsung Pay.
Optical/QR code
Here we are integrating cloud-based technology that uses QR code by retailers and store outlets.
Thanks to the QR-code system, users can buy anything by making payment through their smartphone almost everywhere they go: offline.
The foremost examples that need to be mentioned here are PayPal, WeChat Wallet, PhonePe, Paytm, and Walmart Pay.
Digital Delivery Technology
The name itself is explanatory. Such digital e-wallets are for the products and services on the internet. In the online world, these applications are used rarely or particularly under some circumstances. The best examples of this technology are Alipay, PayPal, and Amazon.
SMS-based payment
In this method, the user’s account is managed using SMS messages to make payment. This method is used in the P2P marketplace. Some examples are Tigo, Orange Money, and Mobile Money. The topmost advantage is you can make a payment without internet access in the actual world. For example, you are at a store; you need to inform the shopkeeper about the phone number made and confirmation code and this information is enough to make the transaction.
Best practices in making a digital wallet app
If you are planning or have decided to make e-wallet applications, you need to know about the below jotted down points.
Proper usability
This is common advice, but still, most people focus little on the design of applications.
Firstly, good usability means that users can have the same functionalities in both desktop and mobile platforms and have the same features in both versions. Understand the users’ requirements! Who knows what they want- an application or a website! The application should be convenient for both versions.
Security
Safety is the topmost concern of the users. Safety is one reason users are afraid of using e-wallets. However, if you integrate advanced level features to protect the data of users during the web development process, then you need not to worry about the safety of the e-wallet platform that you offer.
Let’s look at the many ways to protect the applications which are integrated with payment pages. The number of features is increased in terms of the security of mobile applications. But companies are doing their best to offer the most secure e-wallet applications.
Passwords
In different e-wallet mobile applications, the password form differs from each other, security code, PIN code, etc. But this doesn’t change its principle. All e-wallet applications use simple yet effective methods to protect the users’ data.
Most digital payment apps are integrated with security features to enhance the safety which the users must fill to protect his account from threats.
Biometric technology
This is a popular and trending facet to protect the e-wallet applications.
The point is crystal clear: as you know, each individual has different fingerprints or features. These different features can be used as a database with the help of devices like scanners, sensors, and other readers. The biometric system collects the individual’s information like (fingerprint) and transfers it into a digital code.
When the user sets his finger on the scanner, then the system matches the code with the one that it collects. If the codes match, then identification is considered successful.
Account blocking
This method is only applicable when none other security measures can safeguard the safety of your money. Then, by calling, or OTP SMS, the users can block his account to protect his e-wallet account.
Monetization
The entire process of ewallet mobile development is costly. Surely you will figure out innovative aspects to earn ROI on the e-wallet. We are going to highlight the monetization issue. You must know some basic monetization application methods, but they are not suitable for digital card wallets.
Future of electronic wallets
Though it is tough to predict the future of technologies. The keen e-wallet supporters believe that time will come when people will not carry paper money at all. Along with this, there are people with opposing beliefs.
According to the public opinion polls, it has been found out that those who support the development of e-wallet applications are secondary. Most of the people still prefer bank cards. After e-currency, Internet banking is the third most used method.
Keeping in mind the different opinions, one can easily say that e-wallet payment services are developing at a high speed. The different financial systems are still acceptable in most places
Summary
Now as I have written above all the aspects related to digital payment services and the future which we all are waiting for. Perhaps it is time for the action. What do you think?
