Understanding how e-wallet is changing definition of transactions

Basically, a wallet is something which holds money, credit card, debit card, shopping cards, ID proof etc. When you are already out for shopping and you forget your wallet at home then do you think it is a done thing ? No, it is not. In this fast moving world, everyone believes in smart work which will save their time and make work easier.

eWallet trend

E-wallet is a digital wallet in which you can preload some amount, credit card number, user’s identification and contact information behind a secured password. With the help of e-wallets, everyone can shop efficiently. According to open source survey, more people prefer online marketplace platform for shopping and e-wallet become its payment arm. Not only online stores, but e- wallet is helpful in physical stores too. E-wallet has made tedious paperwork transactions easy and fast. A person can pay for goods just by transmitting a number from one device to another and the transaction is done. Isn’t it Fast and Interesting?

E-wallet can be classified into three parts:

1. Closed E-wallet : Closed e-wallet can be used at particular places authorized by e-wallet offering organisations and it does not allow cash withdrawal. e.g.Freecharge.
2. Semi-closed E-wallet : Semi-closed E-wallet like Paytm can be used as prepaid online accounts. One can buy services and products from merchants having tie-up with the issuing entity. It does not allow cash withdrawal
3. Open E-wallet : Open E-wallet can be used for purchasing products and services. Unlike closed e-wallet & semi-closed e-wallet, it allows cash withdrawal at ATM’s. e.g. MasterCard, Visa card, Rupay card.

Digital wallet uses various methods to accomplish transactions such as Pull method, Push method & Tap-and-go method. In Pull method, a merchant will ask you for your mobile phone number and will enter it on their payment terminal, after that you will get one-time password (OTP) on your mobile phone then you have to share that OTP with the merchant, and in this way, money gets pulled from your e-wallet. Another is Push method, in which you have to send quick response (QR)code to merchant for scanning, which will help you to transfer money. The merchant will send you a QR code with the bill. QR code is nothing but a barcode which has details of the merchant’s establishment, bill details, etc. When code scanning is done, money from your e-wallet gets deducted and merchant’s account gets credited. Tap-and-go is an interesting and easy method in which you just have to tap your mobile phone with merchant’s terminal for money transfer. Both phones should be NFC (Near Field Communication) enabled phones to perform transactions by tap-and-go method.

What is making E-wallet a boom

• It is time saving.
• It comes up with various offers and coupons.
• Password security service is provided to maintain the confidentiality.
• People can track their expenditures as it facilitates them with their transaction history.
• Some of them offer data retention till 40 years.
• It is easy to use and easy to access.

Let’s see the downside of E-wallet

• E-wallet of one country can not be used in another country.
• Yet few merchants do not offer digital wallets. e.g. Amazon.
• In some conditions like lack of network, a Dead battery of the device or device is not in a working condition then one can not access E-wallet.
• It does not provide 3D secure password which helps to avoid unauthorized access of data.
• E-wallet does not assure you the security of your money if the device is lost.