What is Digital Wallet:

It is the replacement of traditional wallet, A research anticipating that customers will not need to carry cash or cards by 2020. The majority of the transactions would go through eWallet, and it is more associated with smartphones and useful for merchants to boost the revenues and to monetize customer insights. Current eWallets are prepaid wallets, not exactly a digital wallet.

What is the difference?:

Digital Wallet got linked with a bank account can be utilized without entering the card details anywhere across the world and consume all available money from the account whereas widely using mobile wallets are prepaid wallets. Load from a bank account or credit card and it works just like a prepaid mobile calling card.

The majority of the Banks usually don’t adopt to new technologies and features quickly as it is very sensitive for security reasons. However, if banks implement Digital wallets, it is a cakewalk for them to have customer engagement, security, insights as the bank accounts, credit cards got already linked. End of the day mobile wallet can’t replace bank accounts at any point of the time. Based on a source DCB bank and M2P are launching digital wallet to their customers if all the popular banks enable this service to imagine the future of merchant wallet.

What is the strategy behind Digital wallet?:

1.Establishing strong relationship with the customer:

Digital Wallet implementation is a significant advantage to having a strong client base. Consequently, every eCommerce player is interested in having it. Insights and customer behavior can be analyzed, based on the customer behavior business and campaign strategies can be planned.

2.Repetitive customer base:

Once the wallet got loaded with money eventually, you will be forced to buy from the same eCommerce website, and the spend rate also be increased this is a universal human nature, so be careful while spending 🙂

3.Cash inflow from customers:

Companies are creating virtual money with wallet feature which is not used by the user at one go. One famous Indian company is claiming that they have 120 million wallet users if every user has one rupee in his account, the wallet owner has INR 12Crores  liquid cash on his/her hand, imagine if every user has 10/-. Eventually, wallet owner gets interested on top of it.

4.Margins from merchants:

Every dealer pays commission to the wallet owner of minimum 10% for the products they sell; this is another big way of income.

Narasimha Mohan

He is the Author, Product Specialist, Business Consultant, Entrepreneur, Public Speaker, Thought provoking writer, and Joke writer. Follow him on Twitter