The rise of powerful yet affordable mobile technology has had a major impact on how we live our lives, from work to socializing, from studying to shopping. Smartphones and tablets are usurping and making obsolete many items we need to deal with in our day to day lives, and it’s no surprise that digital wallets are increasing in popularity accordingly. Seamlessly integrated into the contactless payment process they offer increased security, convenience, transaction speed, and numerous other benefits.
They are seen to have a ubiquitous use in everyday life, from payments in the supermarket, restaurants, e-shops, to paying for online games. It’s likely that, due to the great convenience, in the coming years they will become the primary payment method across the world.
Why are e-wallets so popular?
First and most important, digital wallets allow users to make quick and easy purchases in-store and online, withdraw cash from ATMs, and send money peer to peer. All of that is followed by great convenience and flexibility in payment choice.
Aside from that, e-wallets are very useful due to their same-day transactions (and top-notch security) Most people who shop online or play online games know all of the benefits of not waiting for traditional banking procedures that can sometimes last for days. On top of that, their data is well encrypted. The failing of traditional banking is especially seen in one industry – online casinos. Customers are turning away from the traditional bank (or “wire”) transfer in their droves and towards e-wallets like PayPal, Neteller, and Skrill – relative newcomers to the finance sector. And usual reasons behind it are faster withdrawal times, money being separate from the bank (unlike paying with credit and debit card), great security, and similar.
In most countries, digital wallets have become the go-to payment option. And this technology is expanding all over the world. As advanced mobile devices become more affordable – and with Samsung, Apple Pay, and Huawei Pay coming pre-installed on smartphones – usage is spreading across Asia and Africa. Other popular payment services include PayPal, Skrill, and Neteller, but the market is very variable.
A rapidly developing market, Southeast Asia has had an astonishing year. A forecast in 2019 predicted 310 million new digital wallet users by 2025 – but this year has seen a huge surge, and this number is now expected a full five years early, by the end of 2020. Residents of the area are taking advantage of high tech phones by Apple and Samsung becoming more affordable and using digital payment methods in retail outlets and online markets.
While the Southeast Asian market is rapidly growing, the world’s most populous country is still leading the way in Asia in terms of e-wallet adoption. In recent years, China has experienced a fintech boom. This has led directly to the rise in cashless payments. Chinese people use digital payment services widely, online, and in land-based shops, bars, and restaurants. Fares on public transport has made commuting in big cities more convenient.
They are also gaining traction across Africa, but SA has adopted the technology faster than most. Users pay digitally for all manner of things, from water, sanitary, and electricity bills through to playing at the card tables and slot machines at their favorite gambling sites. Digital wallets, such as Skrill and Neteller, are the go-to choice for gamers due to the high-security levels and quick transactions, for example, same day withdrawal at online casinos. Another provider often listed as a great choice for these and other kinds of services, is PayPal, as it is one of the fastest on the market.
The ubiquity of mobile wallets in Asia usually takes Europe by surprise. Compared to Asian and African countries, in Europe mobile payments were at the lower part of the popularity curve. But this trend has been beginning to rise rapidly, especially since current world events asked for some alternative payment methods. Sweden is also widely expected to become the first cashless society by March 2023. While the rest of Europe is expected to hit up to 63 million e-wallet users by 2023. The average transaction value per user in 2020 in the European market is $931. While, by the end of 2023, this amount is expected to increase by 90% and reach $1,768.
Benefits of digital wallets
There are all kinds of benefits that both users and retailers can enjoy.
First of all they are known for their great efficiency. Not having to carry all your cards with you cuts down on items you need on your person at all times, and makes purchasing in shops much quicker and easier.
They can also help you track your expenses. Most of us are pretty trigger happy with our credit and debit cards, especially since the introduction of contactless payments. Of course, digital wallets are also contactless, but give the user instant access to their outgoing expenses and transaction history. Being aware of outgoing expenses and being able to view payments at the touch of a button makes people more budget-conscious, and less likely to waste money.
And last, but one of the most important benefits – security. All your credit and debit card details and data are encrypted. This means neither real life nor online stores will see your card number, expiry date, security code, etc. Accessing and confirming transactions using your password or fingerprint ID adds another layer of security to make payments with a digital wallet. If your smartphone or tablet gets stolen or lost, having password and fingerprint ID security makes it much harder for someone else to access your funds.