E-Wallets are becoming more and more popular thanks to the convenience they offer when making purchases both in store and online. In this guide, we’re going to be taking a look at what e-wallets are and whether or not they’re a useful tool for financial management.
What are E-Wallets?
E-Wallets, also known as a remote or digital wallet, is a software based system that secures a user’s payment information and passwords in one place and, in conjunction with mobile payment systems, allow users to make purchases with a quick tap of their mobile phone.
A digital wallet can store multiple methods of digital payment including debit cards, credit cards, loyalty cards and coupons/vouchers, allowing users to make purchases in store or online without having to carry physical cash, cards or having to remember their card details.
It is also possible to store other types of information such as boarding passes, student ID cards, transport tickets and even car keys with e-wallets such as Apple Wallet. For cryptocurrencies such as Bitcoin, e-wallets are currently one of the only ways for users to make payments and maintain their balance.
All of this information is securely stored within the e-wallet and is protected by encrypted passwords as well as a username and password or pin.
Popular E-Wallet Providers
Some of the most popular e-wallet providers include PayPal, Apple Wallet, Samsung Pay, Visa Pay, Google Wallet and online banking apps. These can be accessed through mobile devices and some computers, allowing customers to make payments instantly through either a tap of their device on a contactless machine (Near Field Communication) or through payments to online shops through features such as Apple Pay, Google Pay and PayPal.
How Can E-Wallets Be Used to Manage Finances and Assets?
Whilst the main advantage of using e-wallets is the convenience and ease they offer when making payments in store and online, they also have the added benefit of helping you to manage your finances and assets more easily and efficiently.
Recurring Payments
With e-wallets such as Apple Pay, you can set up recurring payments, taking away the need to fill out forms or change account settings on their biller or banks’ website. It also helps you to avoid any late payment fees as you can rest assured knowing that your payments will be automatically sorted.
Online Banking
Online banking apps give you a large amount of control over your finances, allowing you to send money to others, transfer money quickly and easily between your accounts and apply for and manage overdrafts, loans, credit cards, savings, mortgage, home insurance, life insurance and investments. Many also offer business finance management, allowing you to apply for and manage lending, credit cards and trade finance.
Banks such as Natwest also offer spending analysis that gives you an overview of your weekly and monthly spending as well as more detailed reports of your activity, allowing you to keep track of where your money is coming from and going. This feature also allows you to set a budget on certain categories e.g. Shopping, Bills, Eating Out, Transport, Entertainment and Beauty.
They also offer free basic accounting software, allowing you to snap an expense, fire off an invoice, check your cashflow and stay on top of your tax.
Cryptocurrency Management
E-wallets are currently one of the only ways for users to make cryptocurrency payments and maintain their balance. Cryptocurrency wallets such as Kcash and Cobo have developed their own management products to help users manage their assets more easily and securely.
Generally, ordinary cryptocurrency users will keep their digital assets in a specific digital wallet. The financial tools allow them to obtain benefits, even if they control it themselves, particularly the current cryptocurrency wealth management products in the wallet.
Hyper Pay Wallet and Mars Wallet offer a great range of wealth management products including coins, locks, funds and are tailored to their users’ needs as well as offering high levels of security.
Benefits of Accepting E-Wallet Payments for Businesses
E-wallets offer some great advantages to merchants as well as their customers. By accepting e-wallet payments, you can encourage quicker and easier transactions, allowing customers to purchase your goods or services with just a fingerprint or face ID recognition.
It also increases sales due to the way in which buyer behaviour changes when using a contactless and instant form of payment.
In a poll of 2,000 British consumers conducted by ClearScore, 59% admitted that not having to hand over physical cash had led them to spend more than they’d intended, and 72% said digital payment methods such as Apple Pay and contactless credit cards have encouraged them to make more impulse purchases.
The study also found that two out of five shoppers often lost track of their spending because of the ease of digital payment methods. Whilst this may be a disadvantage for customers, it’s certainly good news for businesses.