The Future of Payment

The Future of Payment

The term digital wallet is a blanket descriptor for a range of technologies that let you perform many tasks. In general, though, a digital wallet (also sometimes called an e-wallet) is a transformation in the way you pay for things. Many digital wallet services work through apps on your smartphone. At the supermarket, for instance, you might simply tap your phone to a compatible check-out register to pay instantly. For others, all you need to use them is something you know, such as your mobile phone number and a PIN (personal identification number).

No matter what form it takes, a digital wallet is based on encryption software that substitutes for your old, analog wallet during monetary transactions. You benefit from the protection and convenience. Merchants benefit because they're more protected against fraud and they sell more products, faster.



Digital Wallet

A smartphone digital wallet will help you pay for stuff, but it will also store your concert tickets, bus and subway passes and gift cards. Retailers will reward your loyalty by offering instant freebies, discounts and coupons. Your digital wallet might even unlock the doors to your house. We can lump the types of digital wallets into two broad categories: client-side -and server-side. Within both categories are wallets that function only with specific vendors (either online or offline) and others that will work with just about any merchant.


Client-side wallets generally refer to those maintained by you, the end user. You download and install a program and then enter all of your pertinent payment and shipping information, all of which is stored on your own personal computer. Then, when you decide to check out at a compatible Web site, your wallet's software. In a server-side wallet, the company supporting the digital wallet (Visa) maintains your e-wallet account on their servers. You don't have any physical plastic cards to lose, nor can anyone steal them, which is a benefit to both you and the retailer, which would otherwise expect to deal with a significant amount of credit card fraud.