With each passing day, our ways of maintaining and handling money or their value seem to be changing.
Those days when money in pockets, cash in wallets, or cards inside the leather bag were common are no more seen.
We have begun our transition with technology that helps us handle our money.
In this respect, one of the major innovations has been the mobile wallet, which revolutionized the way transactions are done by making them quicker, more secure, and easier.
In this article, we’ll explore the concept of mobile wallets, their uses, how to set them up, and compare them with e-wallets to understand the subtle differences between the two. Let’s dive in!
What is a Mobile Wallet?
A mobile wallet is an application program that securely stores your payment information and password on your mobile phone or tablet.
These applications enable users to process transactions, store loyalty cards, manage receipts, and even store identification documents directly through their mobile devices.
Mobile wallets make fast and contactless payments when one is at a POS terminal through the use of near field communication or quick response code.
The use of mobile wallets can be applied from paying for goods at any physical store to transferring funds to friends and family members.
The user’s bank account, debit card, or credit card will often be connected to the wallet.
Read about: The Best Digital Wallets in India: Everything You Need to Know.
Key Features of Mobile Wallets
Some common features of mobile wallets are listed below:
- Payment Options:
Users may save several payment methods, including bank account information, credit or debit cards, and even cryptocurrency.
- Loyalty Cards and Rewards:
Most mobile wallets give you the option to save your loyalty cards and earn points for every purchase.
- Transaction History:
You can easily view your past transactions and track your spending directly within the app.
- Security Features:
Variations in security features, including encryption, fingerprint authentication, and biometric scanning, offer safety in transactions.
- Digital Tickets and Passes:
Mobile wallets also allow users to store tickets, boarding passes, and other critical digital documents in their pocket.
- P2P Transfers:
Some wallets can also facilitate the sending of money between users, which enables the peer-to-peer transaction to take place.
Read about: Top Online Payment Methods Across The World.
How to Use a Mobile Wallet
It is relatively easy to use a mobile wallet. The general steps for most, in fact, remain constant and equally straightforward: three simple ways to use a mobile wallet;
- Download the Mobile Wallet App
Download and select your desired mobile wallet application. Popular ones include;
- Apple Pay (iOS)
- Google Pay (Android)
- Samsung Pay (Android)
- PayPal
- Venmo
With the wallet selected, download the associated app from your appropriate store
- Add Your Payment Methods
Apart from downloading an app, you will be asked to attach your payment information: credit or debit card, as is usually required, or a scanned picture of the card details taken by the phone’s camera.
To add more protection, most mobile wallets can use fingerprint scanning, Face ID, or entering PIN codes.
Some also allow their customers to add digital copies of loyalty cards, gift cards, store IDs, and even tickets that one frequently needs.
- Making Payment
Making payments using the wallet is quite easy once your wallet is set up.
In the case of physical purchases at participating stores, holding your phone near a contactless payment POS terminal pays for you.
Online or inside applications, it simply offers selecting a mobile wallet payment choice in checkout.
Most of the wallets also provide an online payment facility and allow you to make P2P transfers.
This way, you can send money to your friends and family with just a few taps of your fingers without having to use physical cash.
Examples of Mobile Wallets
There are a number of mobile wallet apps, each with unique features and compatibility. A few popular options include the following:
Apple Pay (for iPhone)
Apple Pay is one of the most used mobile wallet applications, supported on iOS devices.
Customers may use their iPhones, iPads, and Apple Watches to make purchases and safely save their credit and debit card information.
It also supports peer-to-peer payments via Apple Cash, linked to the user’s debit card or Apple Card.
Apple Pay is supported nearly anywhere that has in-store NFC terminals and is also supported by many online retailers and apps for very convenient physical and digital transactions.
Read about:How Credit Card Transaction Processing Works? A Quick Guide
Google Pay (for Android)
Google Pay is one of the most used mobile wallet applications amongst Android users.
It is a platform that allows users to save multiple payment options, including credit cards, debit cards, and even loyalty cards in it.
Similar to Apple Pay, Google Pay also has enabled the user to make contactless payments at NFC-enabled terminals.
It also lets its users make peer-to-peer transactions, which is the normal money transfer among friends or family.
Through Google Pay, bill pay and online purchase within an app are allowed.
Samsung Pay (for Android)
Another exclusive mobile wallet is Samsung Pay, which is available only for owners of Samsung devices. In addition to the standard NFC contactless payment, Samsung Pay also supports magnetic secure transmission that can be used to make purchases at traditional magnetic stripe card readers and thus gives it a broader range than some of the other wallets.
Samsung Pay also offers rewards programs, with more security through Samsung Knox and biometric authentication.
PayPal and Venmo
Primarily online payment systems, the mobile applications of both PayPal and its soon-to-be sibling, Venmo, offer full-service digital wallet features, enabling users to attach bank accounts, debit, and credit cards for phone-based transactions.
As well-known, both Venmo and PayPal do P2P transfers without a glitch, so sending money to friends or family takes an instant.
Read about: P2P Scams: What They Are and How to Avoid Them?
What is Mobile Wallet in Banking?
In banking terms, a mobile wallet implies the integration of your banking details with a digital wallet in your phone.
Mobile wallets, thus, allow banks’ customers to pay bills, access their accounts, and send cash while on the go using their mobile phones.
Because of increased convenience and safety, more and more banks have integrated mobile wallets in the management of transactions.
In this regard, this application enables customers to: pay utility bills; transfer funds and purchase items with contactless payments using a physical location.
Additionally, it also allows to view account balances and transactions; make purchases through integrated third-party providers’ apps through wallets that facilitate the processing of customer payments.
Many banks have their own mobile wallet applications that allow seamless integration with one’s bank account.
That way, one is able to keep track of money spent using it and handle funds on the go.
Read about: The Best Way to Transfer Large Sums of Money Abroad
E-Wallet vs Mobile Wallet
While e-wallet and mobile wallet are terms basically used synonymously, subtle differences exist between the two.
To get the perfect choice that suits your needs, therefore, the differences will have to be known.
E-Wallet
E-wallet-it is a general term referring to any form of electronic payment system used in the storage and management of digital currency, details of transactions, and payment information over the internet.
The wallets are accessible both on a desktop and also on mobile devices.
They facilitate transaction activities over the internet, such as online purchases, bill payments, and P2P. Popular e-wallet examples include PayPal, Skrill, and Google Wallet.
Mobile Wallet
A mobile wallet is an application or platform created for mobile devices.
It enables users to store payment details, make in-person purchases, and transfer money using NFC, QR codes, or other mobile technologies.
Difference
E-wallets can be utilized on desktops or smartphones, but mobile wallets are utilized on mobile devices only.
E-wallets are usually applied to an online transaction while mobile wallets have more applications toward in-store or person-to-person purchases.
Mobile wallets make use of Near Field Communication or quick response code to pay without actually contacting while e-wallets have been applied to online purchase.
Why a Mobile Wallet is Useful?
Mobile wallets have a lot of advantages and are becoming an essential tool these days. Some of the reasons they are so handy are as follows:
Convenience
You do not have to carry any physical cash or multiple cards with the help of a mobile wallet. Everything you need is on your phone.
Security:
Mobile wallets boast of additional security through encryption, biometric authentication, and tokenization that physical cards cannot match, making them the better option.
Speed:
Mobile wallets, especially those with NFC technology that enables contactless purchases at checkout, are incredibly quick to use.
Centralized Management:
Using mobile wallets, users are able to store, aside from their means of paying for goods or services, loyalty cards, tickets, and other digital documents in order to achieve centralized management of your financial data.
Global Acceptance:
Most mobile wallets have worldwide acceptance; hence, it allows international transactions to be easier and more secure.
Conclusion
A mobile wallet is an electronic means for people to store information about the payments, make secured transactions, and manage their financial dealings through use of their cellular device.
With its ease of use, added security, and wide range of applications, it’s little wonder that mobile wallets are edging out traditional wallets for popularity.
It continuously works to stay updated, though, as more features added in-cryptography support and advanced biometric security-can indeed change the experience for good.
Whether you’re using an e-wallet or a mobile wallet on Android or iPhone for the first time, one thing is certain: mobile wallets are becoming essential.
They offer a convenient way to perform various financial transactions, including effortless bill payments.
Read about:The Evolution of Banking in India: From Tradition to Digital
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