We may no longer have to walk around with cash bulging in our wallets. It is predicted that in the near future, digital wallets will end up replacing other types of payments. Money will no longer be made of notes and coins but will be digitalized. If older generations are more or less wary of this payment revolution, younger generations are keener than ever to adopt this new technology, especially as it has become a very secure and convenient means of payment.
What is a digital wallet?
Digital wallets are electronic devices that allow electronic transactions, such as buying on-line or using a smartphone to effect payment at a store. They are also referred to as e-wallets. Most digital wallet services are accessible through applications on your device.
The first digital wallet emerged in the 1990s when PayPal was used as a software so that eBay clients could store their cards on the system for payments. It nevertheless remained practically stagnant as consumers, concerned about the security, were wary of embracing this new technology. Others simply were not even aware of this system.
The latest digital wallet revolution occurred when Apple Pay was launched in 2014. Samsung, Starbucks and many more followed with this innovative mode of payment. Today, the digital wallet has become mainstream with about 37 million Americans using mobile payments. It is foreseen that in 2017, more than a third of younger generations will be using this system. Countries like Norway, Denmark, Turkey and Israel are where digital wallets are mostly used. Australia, Canada and India are following close behind.
Millennials are behind the future boom
Millennials (those born between 1982 and 2005) represent the largest demographic component in the United States. By 2025, they are expected to generate almost half of the total income in the country, gaining the title of being the “financial force of tomorrow”. According to statistics, 86 percent of this generation own a smartphone and may be inclined to opt for online payments. Out of this proportion, 33 percent even consider that they will not be needing a bank within the next five years. The digital wallet is indeed a very convenient tool for the Millennials, allowing them to check their e-statement, make transactions and set recurring payments easily as well.
Reasons urging Millennials to embrace digital wallets
Digital wallets are attractively convenient and flexible to Millennials in this hectic everyday life. Transactions are hassle-free and executed rapidly. It has been equally established that this generation likes to monitor their spending on a regular basis. As such, using digital wallets offers them the ease of tracking their money quickly, from anywhere.
Furthermore, digital wallets offer annexed services and special offers to customers who can choose from the best deals and enjoy the benefits. Simple engagement features like reminding clients of upcoming expiry dates and events, or notifying them of bonuses are much appreciated. More important features include storing of boarding passes, tickets and even ID cards which carries a lot of weight with consumers. Digital wallets equally offer the convenience of lending, paying back and splitting bills among friends.
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