In a bid to authenticate and formalize transactions in even more convenient ways, economies are embracing the cashless policy. At the dawn of the internet era in the early nineties, there became an obvious need for digital payment pathways to ease transactions. The attempt was made earlier though, as David Chaum the American cryptographer, created digital cash in 1983. This was the birth of cryptocurrencies.
It will interest you to know that internet purchase started in the early nineties, where the first transaction was at Pizza Hut for a pepperoni pizza in 1994.
Digital wallet or E-wallet is a digital payment method where electronic transaction is carried out between two parties over an electronic device, online service or software program.
Now, a vast majority of people are actively utilizing mobile phones for online transactions which has necessitated the need for a more convenient and seamless payment method. The mobile wallet, a mobile version of the digital wallet is increasingly gaining relevance as the evolution trend continues.
You should be familiar with some digital mobile wallets like the Interswitch, Google pay, Samsung pay, Apple pay and Android pay among others, that allows the linkage of cards to your device.
The mobile wallet has found its use beyond payment alone. It is used also for authentication of user, to issue cash reward under a loyalty system, tickets, boarding passes and the list is inexhaustible.
How does the mobile wallet work to secure payments?
Your mobile device or smartphone has an inbuilt NFC (Near Field Communication wireless technology or Bluetooth Low Energy (BLE) that allows communication between your device and the receiving system operating the same NFC wireless technology. A tap on your phone and swipe is the prompt needed for seamless transaction in realtime. This has a time saving advantage over having to use your actual debit or credit card, needless to say, the convenience of not having to carry a physical bulky wallet.
Your card information are securely stored on your mobile wallet so you can at any and all times perform transactions, make payment or simply keep track of your account on the go
Pros of Mobile Wallet
1. Time saving
2. Saves money on transaction fees by third party
3. Easy account review and tracking
4. Convenience
5. Cash back reward
Pros For Your Business
1. Cuts cost of securing expensive POS system
2. Added competitive edge with real time transaction
3. Fast and secure payment option
4. Elimination of third party transaction fee
4. Improved customer experience
There are many operators of mobile money and wallet in Africa of which MTN mobile money with 22.2million active subscribers spread across 15 countries and Safaricom M-pesa with over 37 million, are most prominent.
In our next post on this series we will consider reasons behind the slow adoption of this mobile money and wallet technology in Africa, despite the huge penetration of smart phones. We will see types of digital mobile wallet also.
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