What is a Digital Wallet and How’s it Different?

What is a Digital Wallet
Written by Shoaib Iqbal

A wallet is something that allows you to keep money in it. A digital wallet or virtual wallet has the same purpose but procedure and methodology is kind of different from simple wallets. It is quite a new term. Digital or virtual wallet is a software which works as a virtual system instead of paper money. This software is encrypted and protected. Digital wallets can access credit card accounts, cash and shipping details by the information they contain.

Why is it important?

Don’t think of digital wallet as an online payment system. It is totally different. You can send and receive money through an online payment system. In any regular retail environment, online payment system won’t work. There are a lot of steps you would have to follow in any that system such as entering your ID and password, manually inserting the amounts and going through a long confirmation process.

One of the largest and famous online paying systems is Paypal. It was first established in 1988. In 2006, another largest system was introduced named as Google Checkout. Later in 2013, Google Wallet replaced it. It was easy to neglect digital wallets and other similar technologies because Paypal and other systems have been on the top for quite a long time.

There are many digital wallets introduced until now. You can easily pay for things in any kind of environment using your smartphone through digital wallets. Some of the famous digital wallets nowadays are Venmo, Android Pay, Apple Pay and Samsung Pay. The environment includes any physical retail store, apps, and websites. Unlike online payment system in which you have to spend a lot of minutes to enter your information and then wait for confirmation, you can simply pay by clicking just one button. The store whether it’s physical or online must accept the digital wallet from which you’re paying. For example, there is a store that accepts Apple Pay, you just need to enable the digital wallet suitable for it i-e Apple Pay. In order to pay, place the phone near the payment reader. Put your finger on the ID and confirm your transaction.

Digital wallets trends

It is difficult to tell you the number of digital wallets’ users as most of the companies don’t disclose it. However, they report their growth figures and volume. Some information can be deducted through it. Apple Pay is one of the most famous digital wallets in the market. In the first quarter of 2017, 450% larger transactions were processed by Apple pay as compared to 2016.

Digital Wallets and E-commerce

E-commerce stores are online stores where people can buy things just by sitting at home. As the technology is growing very fast if you own an online store you need to introduce those technologies in your store also. More and more store owners are using digital wallets so make sure that your store is compatible with it. You may experience a loss if it’s not.

Customers don’t like to follow long steps while paying for things online. Sometimes they like a thing but don’t buy it just because of those lengthy steps. If you convince people to buy things with a tap of a button instead of going through a long process, you will surely get most customers. This can be done by enabling virtual wallets in your stores. So, the gap between people who are making money and know what they are doing and people who don’t know what they are doing and why they are lacking behind is only growing.

There are a lot more advantages of virtual wallets. They contain so much information about consumers. This information makes it easy for you to analyze and interpret your customer’s behavior. You can plan and design things more effectively by using these opportunities.

Virtual wallets are not going anywhere in the near future, they are here to stay. It can be proved by the high rate of companies adopting it and continuous volume of usage by the people. In fact, they will become even more famous in the future. This means that you have to make your stores and business compatible with it in order to gain success. And if you are a customer then using it will make your life easier.


About the author

Shoaib Iqbal

Shoaib Iqbal is a global keynote speaker, trainer, author and consultant in Digital Marketing and Online Selling for global organizations. He is the Founder of an Online Marketing Agency, specializing in SEO since 2011.

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