E-wallet is now the new norm, shaping the banking and payment landscape.
FREMONT, CA: World's digital financial transactions are experiencing exponential growth. The country has come a long way from bill-to-cash payments to accepting, adapting, and ultimately preferring digital money over cash. The increase of e-wallets also carried with it several other prepaid tools such as Prepaid Payment Tools (PPI) and paper vouchers. Packed with user-friendly elements, straightforward interfaces, and attractive discount offers, they are safer than carrying real cash— an appeal to the tech-savvy generation. E-wallets are bringing about a radical change in conventions of payment modes.
Other emerging market commonalities such as the growing penetration of smartphones and internet into mobile services, tech-savvy client expectations, and the need for instant and one-touch payment solutions are also driving the implementation of the e-wallet. Most importantly, the entry of non-bank organizations that offer innovative payment alternatives plays a critical part in digital wallet achievement.
Compared to traditional payment channels, customer experiences with e-wallets have demonstrated greater acceptance. It is therefore essential that banks recognize the significance of a thorough approach for digital banking. Mobile/digital wallets help banks improve their customer relationship and retention, place their payment cards at the top of the wallet, and protect their customers and the institution against fraud. Also, since banks already have a current client base, they are better placed to monetize this chance compared to non-financial companies that need to spend on client acquisition.
As an alternative strategy, some of the major banks are working with digital wallet businesses to formulate a 'win-win' proposal, through which the bank gains access to the client base on the mobile wallet, while the wallet gains wider reach for online and offline merchant transactions by associating with the card network of the bank.
Banking companies also leverage loyalty programs to engage and ensure that the clients are better positioned to boost the use of mobile wallet service, broadening the business revenue prospects.
