What Are Consumers Looking For With Digital Wallets?

In my last post, I brought you the cold, hard facts and explained why digital wallets are the future of payments. Now, I'll show you what customers are looking for with digital wallets.

People want a fast, easy-to-use, safe, and seamless payment experience. This is where the mobile wallet comes in. People enjoy using mobile wallets, and why wouldn’t they? Digital wallets allow users to safely pay for purchases in advance, worry-free, and with no hassle. 85 percent of smartphone users who use contactless payment technology have positive perceptions of the payment method. Mobile wallets allow consumers to make purchases using an app or a quick flash of a smartphone. Cash, credit cards, coupons, or even ID cards are a thing of the past thanks to the convenience of mobile wallets.

According to a recent survey by McKinsey & Company, 70 percent of consumers strongly believe that mobile payments are going to be the norm, and will be the favoured form of payment for national and online merchants, the two categories where digital payments are the most important.

ADVANTAGES OF A DIGITAL WALLET

EASY TO USE, SIMPLE TO CARRY:

• The days of carrying around a physical wallet with multiple cards are over–simply download the mobile wallet to your device, save your card information, and start your spending!
• When purchasing at a store, simply select which form of payment you’d like to make on your phone and hold up the device to the POS machine to pay.
• Digital wallets use the same NearField Communication (NFC) chip as debit/credit cards
• Your card info is a saved–and encrypted–to your mobile app, so you don’t have to waste time re-entering your card info for each purchase.

FRAUD MONITORING AND ZERO-LIABILITY PROTECTION:

• Mobile wallets offer 24/7 fraud monitoring, and thanks to zero-liability protection, the consumer will be reimbursed for any loss, fraud, or unauthorized transactions.

ENHANCED SECURITY FEATURES:

• Additional security features with digital wallets include activity alerts, push notifications, transaction history, and personal account monitoring, offering users transparency and security on the go.
• If you lose a credit or debit card, you’ll need to cancel the cards and get them replaced. With a digital wallet, you can remotely wipe your lost or stolen phone and keep your data safe.
• Biometrics improves security by using unique physical characteristics, such as fingerprints or facial geometry, for identification purposes.

DATA ENCRYPTION:

• Mobile wallets are more secure than cash or debit/cred cards because the information stored on a digital wallet is encrypted. When data is submitted via a mobile wallet to make a payment, your account information is never openly available. 
• Phones can only be opened with your own fingerprint or personal ID code, so it is much harder to access your data than a regular wallet

IMPROVED COMMUNICATION, ENGAGEMENT, AND REWARDS:

• Consumers can receive special offers, rewards, and discounts through their digital wallet
• 55 percent of consumers want to be able to use reward points at checkout.
• Many consumers are in favour of a digital wallet that integrates loyalty programs that can be used at multiple merchants
• Businesses can share news, promotions, announcements, product details, and other valuable content and information through the app
• Data provided through the app allows businesses to deliver targeted promotions that consumers actually want, and suggest easy-to-use, value-added actions
• The three most sought-after features that drive consumer usage of digital wallets are:
  • Paying with points
  • Targeted deal and offers
  • Integrated payments

The key to a successful digital wallet is providing an improved and enhanced shopping experience. Not surprisingly, prepaid payments go hand-in-hand with digital wallets. “In many ways, a prepaid card is to a mobile wallet what a debit card is to a checking account,” prepaid industry executive Amir Wain says. “Think about how much more accessible debit cards made our checking accounts. Prepaid cards do the same for mobile wallets today.”

Mobile wallets and digital payments can reduce customer acquisition cost, decrease operational costs, increase the lifetime value of customers, and improve revenue. Many businesses stand to benefit from the use of digital wallets, including merchants, marketing firms, payments processors, finance companies, and more.