The rise of digital wallets
Digital wallets are fast-growing in the UK and beyond, a development enabled by the advances in cloud computing and mobile devices. As consumers look for easier ways to transact, the technology provides them with a real solution.
wallets, which can store the details of debit and credit cards, loyalty cards
and identity, enable people to transact online without having to continually
enter all of their information.
represent a revolution in the payments space and are enabled by an advanced cloud computing setup. Details are stored securely online, and are ready to be
accessed by customers logging in and authorising a transaction.
idea of digital wallets is to offer a system that is analogous to physical
wallets, holding all of the information without the need to carry it all and
enter details at each transaction. They also offer greater security: by storing
the data, consumers no longer have to hand over their credit card information
to online retailers they have not purchased from before.
V.me by Visa digital wallet (see login screen below) can hold all of the cards and identity information
that people need. We keep the nature of the transaction the same as with a
credit or debit card, simply processing it. Many of the alternative mobile wallets require users to preload
work with a number of banks and building societies, including Royal Bank of
Scotland and Nationwide, as well as payment provider WorldPay. Our initial
retail partners include Currys, Dixons, PC World and Clarks, covering 1,400
stores - and as we add more retailers there will be 4,000 merchants offering the
service by January. For small retailers it's a chance to get a new segment of
the market: customers who might have been concerned about using their card on
an unfamiliar website now have the security of knowing that their card details
won't be shared with the merchant.
digital wallet market is still fairly young, and there is a lot of development
activity going on. To some degree, this means different ideas on direction
between the providers. However, our vision is for a standardised method of payment,
because this means it is much easier for consumers to go everywhere and have
one system to use. Obviously, we do not want to hamper innovation, but it is
vital that there is simplicity.
growth of mobile devices, including tablets, creates a fantastic future for
digital wallets. In addition to customers using the devices to make purchases
at home or while travelling, there is a real opportunity in-store.
many retailers expect their staff to carry mobile devices, such as tablets, on
which purchases can be made by customers logging in to their digital wallets.
Additionally, when you look at self scanning devices such as those offered in
Waitrose stores, there is an opportunity for consumers to use apps within their
phones to scan and then pay using their wallets.
wallets exist within an ecosystem of traditional card payments, cash, and NFC
devices (that enable customers to make payments by touching their card or
enabled phone on a reader). We think that the market will continue to evolve
and many systems will coexist, with customers and retailers choosing what is
most appropriate in each situation.
2020, fifty per cent of transactions are likely to be sourced from a mobile
device, be they for initial information or direct payment. It is important that
we remain device agnostic, so that we can enable simplicity and access for all
customers. The growth in mobile will only serve to advance the popularity of
this fascinating payments technology.