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| {{Short description|Electronic wallet}} | |||
| A '''digital wallet''' refers to an electronic device that allows an individual to make ] transactions. This can include purchasing items on-line with a computer or using a smartphone to purchase something at a store. Increasingly, digital wallets are being made not just for basic financial transactions but to also authenticate the holder's credentials. For example, a digital-wallet could potentially verify the age of the buyer to the store while purchasing alcohol. It is useful to approach the term "digital wallet" not as a singular technology but as three major parts: the system (the electronic infrastructure) and the application (the software that operates on top) and the device (the individual portion).<ref name="University of Toronto">{{cite web |accessdate=March 23, 2013 |url=http://propid.ischool.utoronto.ca/digiwallet_overview |title=A Global Overview Of Digital Wallet Technologies |publisher=University of Toronto |date=May 28, 2011 }}</ref> | |||
| {{multiple| | |||
| {{morerefs|date=August 2021}} | |||
| {{essay|date=August 2021}} | |||
| }} | |||
| A '''digital wallet''', also known as an '''e-wallet''' or '''mobile wallet''', is an ], ], or ] that allows one party to make ]s with another party bartering ] units for ]. This can include purchasing items either ] or at the ] in a ] store, using either ] (on a ] or other ]) or (for online buying only) using a ] or other ]. Money can be deposited in the digital wallet prior to any transactions or, in other cases, an individual's bank account can be linked to the digital wallet. Users might also have their ], ], ] and other ID documents stored within the wallet. The credentials can be passed to a merchant's terminal wirelessly via ] (NFC). | |||
| An individual’s bank account can also be linked to the digital wallet. They might also have their driver’s license, health card, loyalty card(s) and other ID documents stored on the phone. The credentials can be passed to a merchant’s terminal wirelessly via ] (NFC). Certain sources are speculating that these smartphone “digital wallets” will eventually replace physical wallets.<ref name=FP> Financial Post. Retrieved May 1, 2011</ref> The system has already gained popularity in Japan, where digital wallets are known as ] or “wallet mobiles”<ref>{{cite web|last=Clark|first=Sarah|title=NTT Docomo to take Japanese mobile wallet global|url=http://www.nfcworld.com/2012/10/11/318353/ntt-docomo-to-take-japanese-mobile-wallet-global/|publisher=NFC World|accessdate=March 23, 2013}}</ref> | |||
| Increasingly, digital wallets are being made not just for basic financial transactions but to also authenticate the holder's credentials. For example, a digital wallet could verify the age of the buyer to the store while purchasing alcohol. The system has already gained popularity in Japan, where digital wallets are known as "wallet mobiles".<ref>{{Cite web |last=Clark |first=Sarah |date=11 October 2012 |title=NTT Docomo to take Japanese mobile wallet global |url=http://www.nfcworld.com/2012/10/11/318353/ntt-docomo-to-take-japanese-mobile-wallet-global/ |url-status=live |archive-url=https://web.archive.org/web/20171120074928/https://www.nfcworld.com/2012/10/11/318353/ntt-docomo-to-take-japanese-mobile-wallet-global/ |archive-date=20 November 2017 |access-date=March 23, 2013 |publisher=NFC World}}</ref> In addition, a few US states have adapted digital driver's license and state IDs to be added to digital wallet in lieu of the physical card and it can be used at selected TSA checkpoints at airports, banking or enterprise.<ref>{{Cite web |last=Barrett |first=Randy |date=February 8, 2023 |title=Digital Driver's Licenses Are Finding Their Way to State and Federal Agencies |url=https://fedtechmagazine.com/article/2023/02/digital-drivers-licenses-are-finding-their-way-state-and-federal-agencies |url-status=live |archive-url=https://web.archive.org/web/20231101073724/https://fedtechmagazine.com/article/2023/02/digital-drivers-licenses-are-finding-their-way-state-and-federal-agencies |archive-date=November 1, 2023 |access-date=November 1, 2023 |website=FedTech}}</ref> | |||
| ⚫ | ==Technology== | ||
| ⚫ | A digital wallet has both a software and information component. The software provides security and encryption for the personal information and for the actual transaction. Typically, digital wallets are stored on the client side and are easily self-maintained and fully compatible with most ] |
||
| A cryptocurrency wallet is a digital wallet where private keys are stored for ] like ]. | |||
| ⚫ | |||
| ⚫ | ==Technology== | ||
| ⚫ | Digital wallet systems enable the widespread use of digital wallet transactions among various retail vendors in the form of mobile |
||
| ⚫ | A digital wallet has both a software and information component. Secure and fair electronic payment systems are an important issue.<ref name="Kang Shao Wang 2018 pp. 13–19">{{cite journal | last=Kang | first=Baoyuan | last2=Shao | first2=Dongyang | last3=Wang | first3=Jiaqiang | title=A fair electronic payment system for digital content using elliptic curve cryptography | journal=Journal of Algorithms & Computational Technology | volume=12 | issue=1 | date=2018 | issn=1748-3018 | doi=10.1177/1748301817727123 | pages=13–19| doi-access=free }}</ref> The software provides security and encryption for the personal information and for the actual transaction. Typically, digital wallets are stored on the client side and are easily self-maintained and fully compatible with most ] websites. A server-side digital wallet, also known as a thin wallet, is one that an organization creates for and about you and maintains on its ]. Server-side digital wallets are gaining popularity among major retailers due to the security, efficiency, and added utility it provides to the end-user, which increases their satisfaction of their overall purchase.<ref>{{Cite book |last=Miklesh Prasad Yadav |first=Madhu Arora |url=https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3369651 |title=Study on impact on customer satisfaction for E-wallet using path analysis model. |date=2019 |publisher=International Journal of Information Systems & Management Science |ssrn=3369651 |access-date=26 September 2022 |archive-url=https://web.archive.org/web/20220926082524/https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3369651 |archive-date=26 September 2022 |url-status=live}}</ref> The information component is basically a database of user-input information. This information consists of your shipping address, billing address, payment methods (including credit card numbers, expiry dates, and security numbers), and other information. | ||
| . | |||
| ⚫ | Digital wallets are composed of both digital wallet devices and digital wallet systems. There are dedicated digital wallet devices such as the biometric wallet by ],<ref>{{Cite magazine |last=Murphy |first=David |title=Dunhill Wallet Uses Biometrics |url=https://www.pcmag.com/article2/0,2817,2378775,00.asp |url-status=live |archive-url=https://web.archive.org/web/20171002170236/https://www.pcmag.com/article2/0,2817,2378775,00.asp |archive-date=October 2, 2017 |access-date=March 23, 2013 |magazine=PC Magazine}}</ref> a physical device that holds cash and cards along with a ] mobile connection. Presently there are further explorations for smartphones with NFC digital wallet capabilities, such as smartphones utilizing ] ] and ] iOS operating systems to power wallets such as ] and ].{{cn|date=February 2024}} | ||
| ==Setup and use== | |||
| A client side digital wallet requires minimal setup and is relatively easy to use. Once the software is installed, the user begins by entering all the pertinent information. The digital wallet is now set up. At the purchase/check-out page of an e-commerce site, the digital wallet software has the ability to automatically enter the user information in the online form. By default, most digital wallets prompt when the software recognizes a form in which it can fill out, if you chose to fill out the form automatically, you will be prompted for a ]. This keeps unauthorized users away from viewing personal information stored on a particular computer. | |||
| ⚫ | Digital wallet systems enable the widespread use of digital wallet transactions among various retail vendors in the form of ]s systems and digital wallet applications. The ] mobile payments system and ] service has widespread use in ] and ],<ref>{{Cite news |date=June 30, 2007 |title=Dial M for money |url=http://www.economist.com/node/9414419?story_id=9414419 |url-status=live |archive-url=https://web.archive.org/web/20130115051330/http://www.economist.com/node/9414419?story_id=9414419 |archive-date=January 15, 2013 |access-date=March 23, 2013 |work=The Economist}}</ref> while the ] application has been adopted by a number of vendors in the U.S. and worldwide.<ref>{{Cite web |title=PayPass Adoption Study |url=http://newsroom.mastercard.com/press-releases/new-mastercard-advisors-study-on-contactless-payments-shows-almost-30-lift-in-total-spend-within-first-year-of-adoption/ |url-status=dead |archive-url=https://web.archive.org/web/20210301160745/https://newsroom.mastercard.com/press-releases/new-mastercard-advisors-study-on-contactless-payments-shows-almost-30-lift-in-total-spend-within-first-year-of-adoption/ |archive-date=March 1, 2021 |access-date=March 23, 2013 |publisher=MasterCard Advisors}}</ref> | ||
| ===ECML=== | |||
| Digital wallets are designed to be accurate when transferring data to retail checkout forms; however, if a particular e-commerce site has a peculiar checkout system, the digital wallet may fail to properly recognize the forms fields. This problem has been eliminated by sites and wallet software that use ECML technology. ] is a protocol that dictates how online retailers structure and setup their checkout forms. Participating e-commerce vendors who incorporate both digital wallet technology and ECML include: ], ], ], ] and ]. | |||
| Digital wallets are being used more frequently among Asian countries as well. One in every five consumers in Asia are now using a digital wallet, representing a twofold increase from two years ago. A ] mobile shopping survey among 8500 adults, aged 18–64 across 14 markets, showed that 45% of users in China, 36.7% of users in India and 23.3% of users in Singapore are the biggest adopters of digital wallets. The survey was conducted between October and December 2015. Further analysis showed that 48.5% of consumers in these regions made purchases using smartphones. Indian consumers are leading the way with 76.4% using a smartphone to make a purchase, which is a drastic increase of 29.3% from the previous year. This has inspired companies like Reliance and Amazon India to come out with their own digital wallet. ] has already introduced its own digital wallet.<ref>{{Cite web |last=Chanchani |first=Madhav |date=7 March 2016 |title=Amazon India planning launch of digital wallet in a bid to build online payments business |url=http://economictimes.indiatimes.com/tech/internet/amazon-india-planning-launch-of-digital-wallet-in-a-bid-to-build-online-payments-business/articleshow/51282576.cms?intenttarget=no |url-status=live |archive-url=https://web.archive.org/web/20190131041746/https://economictimes.indiatimes.com/tech/internet/amazon-india-planning-launch-of-digital-wallet-in-a-bid-to-build-online-payments-business/articleshow/51282576.cms?intenttarget=no |archive-date=31 January 2019 |access-date=27 June 2017 |via=The Economic Times}}</ref> | |||
| ==Application of digital wallets== | |||
| ==Security== | |||
| ⚫ | Consumers are not required to fill out order forms on each site when they purchase an item because the information has already been stored and is automatically updated and entered into the order fields across merchant sites when using a digital wallet. Consumers also benefit when using digital wallets because their information is encrypted or protected by a private software code; merchants benefit by receiving protection against fraud. | ||
| ⚫ | Consumers are not required to fill out order forms on each site when they purchase an item because the information has already been stored and is automatically updated and entered into the order fields across merchant sites when using a digital wallet. Consumers also benefit when using digital wallets because their information is encrypted or protected by a private software code; merchants benefit by receiving a combination of protection against fraud, faster receipt of payment, decreased transaction costs, and decreased theft loss. | ||
| ⚫ | Digital wallets are available to consumers free of charge, and they're fairly easy to obtain. For example, when a consumer makes a purchase at a merchant site that's set up to handle server-side digital wallets, |
||
| ⚫ | Digital wallets are available to consumers free of charge, and they're fairly easy to obtain. For example, when a consumer makes a purchase at a merchant site that's set up to handle server-side digital wallets, they type their name, payment and shipping information into the merchant's own form. At the end of the purchase, the consumer is asked to sign up for a wallet of their choice by entering a user name and password for future purchases. Users can also acquire wallets at a wallet vendor's site. | ||
| Although a wallet is free for consumers, vendors charge merchants for wallets. Some wallet vendors make arrangements for merchants to pay them a percentage of every successful purchase directed through their wallets. In other cases, digital wallet vendors process the transactions between cardholders and participating merchants and charge merchants a flat fee. (Computer World) | |||
| Most, if not all digital wallets offer advanced security features e.g. ] and encryption, this protects the financial information of the users thus preventing fraud.<ref>{{Cite web |date=2018-08-17 |title=Top Five Emerging Trends in Procurement - SIPMM Publications |url=https://publication.sipmm.edu.sg/top-five-emerging-trends-procurement/#The_Advantages_of_using_E-Wallets |url-status=live |archive-url=https://web.archive.org/web/20230406091029/https://publication.sipmm.edu.sg/top-five-emerging-trends-procurement/#The_Advantages_of_using_E-Wallets |archive-date=2023-04-06 |access-date=2023-04-06 |website=publication.sipmm.edu.sg |language=en-US}}</ref> | |||
| ==Advantages for e-commerce sites== | |||
| Upwards of 25% of online shoppers abandon their order due to frustration in filling in forms. (Graphic Arts Monthly, 1999) The digital wallet combats this problem by giving users the option to transfer their information securely and accurately. This simplified approach to completing transactions results in better usability and ultimately more utility for the customer. | |||
| ==European Payments Initiative== | |||
| With the acquisition of ], ] (EPI) Company has announced that it will create an all European digital wallet.<ref>{{Cite web |title=Dutch payment processor iDeal to become European standard {{!}} NL Times |url=https://nltimes.nl/2023/04/25/dutch-payment-processor-ideal-become-european-standard |url-status=live |archive-url=https://web.archive.org/web/20230629141216/https://nltimes.nl/2023/04/25/dutch-payment-processor-ideal-become-european-standard |archive-date=2023-06-29 |access-date=2023-04-26 |website=nltimes.nl |language=en}}</ref><ref>{{Cite web |title=EPI Company announces iDEAL and Payconiq acquisition |url=https://thepaypers.com/payments-general/epi-company-announces-ideal-and-payconiq-acquisition--1262337 |url-status=live |archive-url=https://web.archive.org/web/20230426084002/https://thepaypers.com/payments-general/epi-company-announces-ideal-and-payconiq-acquisition--1262337 |archive-date=2023-04-26 |access-date=2023-04-26 |website=thepaypers.com |language=en}}</ref><ref>{{Cite web |last=Dumitrescu |first=Irina |date=2023-04-25 |title= EPI Company announces acquisitions, additional shareholders and the coming launch of its new instant payment solution |url=https://www.epicompany.eu/epi-company-announces-acquisitions-additional-shareholders-and-the-coming-launch-of-its-new-instant-payment-solution/ |url-status=live |archive-url=https://web.archive.org/web/20230425100304/http://www.epicompany.eu/epi-company-announces-acquisitions-additional-shareholders-and-the-coming-launch-of-its-new-instant-payment-solution/ |archive-date=2023-04-25 |access-date=2023-04-26 |website=European Payments Initiative |language=en-US}}</ref><ref>{{Cite web |last=agency |first=Acato Digital |date=2023-04-25 |title=iDEAL Becomes More Ideal |url=https://www.ideal.nl/en/actueel/nieuws/ideal-becomes-more-ideal/ |url-status=live |archive-url=https://web.archive.org/web/20230425092413/https://www.ideal.nl/en/actueel/nieuws/ideal-becomes-more-ideal/ |archive-date=2023-04-25 |access-date=2023-04-26 |website=iDEAL |language=en-US}}</ref> | |||
| ==See also== | ==See also== | ||
| <!-- New links in alphabetical order please --> | |||
| * ] | |||
| * ] | * ] | ||
| * ] | * ] | ||
| * ] | |||
| * ] | |||
| * ] | |||
| * ] | |||
| * ] (NFC) | |||
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| ==References== | ==References== | ||
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| ==External links== | ==External links== | ||
| * RFC |
* {{IETF RFC|4112|link=no}}: ECML specification | ||
| {{Mobile payments}} | |||
| ] | ] | ||
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| ] | |||
Latest revision as of 15:24, 29 December 2024
Electronic wallet | This article has multiple issues. Please help improve it or discuss these issues on the talk page. (Learn how and when to remove these messages)
|
A digital wallet, also known as an e-wallet or mobile wallet, is an electronic device, online service, or software program that allows one party to make electronic transactions with another party bartering digital currency units for goods and services. This can include purchasing items either online or at the point of sale in a brick and mortar store, using either mobile payment (on a smartphone or other mobile device) or (for online buying only) using a laptop or other personal computer. Money can be deposited in the digital wallet prior to any transactions or, in other cases, an individual's bank account can be linked to the digital wallet. Users might also have their driver's license, health card, loyalty card(s) and other ID documents stored within the wallet. The credentials can be passed to a merchant's terminal wirelessly via near field communication (NFC).
Increasingly, digital wallets are being made not just for basic financial transactions but to also authenticate the holder's credentials. For example, a digital wallet could verify the age of the buyer to the store while purchasing alcohol. The system has already gained popularity in Japan, where digital wallets are known as "wallet mobiles". In addition, a few US states have adapted digital driver's license and state IDs to be added to digital wallet in lieu of the physical card and it can be used at selected TSA checkpoints at airports, banking or enterprise.
A cryptocurrency wallet is a digital wallet where private keys are stored for cryptocurrencies like bitcoin.
Technology
A digital wallet has both a software and information component. Secure and fair electronic payment systems are an important issue. The software provides security and encryption for the personal information and for the actual transaction. Typically, digital wallets are stored on the client side and are easily self-maintained and fully compatible with most e-commerce websites. A server-side digital wallet, also known as a thin wallet, is one that an organization creates for and about you and maintains on its servers. Server-side digital wallets are gaining popularity among major retailers due to the security, efficiency, and added utility it provides to the end-user, which increases their satisfaction of their overall purchase. The information component is basically a database of user-input information. This information consists of your shipping address, billing address, payment methods (including credit card numbers, expiry dates, and security numbers), and other information.
Digital wallets are composed of both digital wallet devices and digital wallet systems. There are dedicated digital wallet devices such as the biometric wallet by Dunhill, a physical device that holds cash and cards along with a Bluetooth mobile connection. Presently there are further explorations for smartphones with NFC digital wallet capabilities, such as smartphones utilizing Google's Android and Apple's iOS operating systems to power wallets such as Google Pay and Apple Pay.
Digital wallet systems enable the widespread use of digital wallet transactions among various retail vendors in the form of mobile payments systems and digital wallet applications. The M-PESA mobile payments system and microfinancing service has widespread use in Kenya and Tanzania, while the MasterCard PayPass application has been adopted by a number of vendors in the U.S. and worldwide.
Digital wallets are being used more frequently among Asian countries as well. One in every five consumers in Asia are now using a digital wallet, representing a twofold increase from two years ago. A MasterCard mobile shopping survey among 8500 adults, aged 18–64 across 14 markets, showed that 45% of users in China, 36.7% of users in India and 23.3% of users in Singapore are the biggest adopters of digital wallets. The survey was conducted between October and December 2015. Further analysis showed that 48.5% of consumers in these regions made purchases using smartphones. Indian consumers are leading the way with 76.4% using a smartphone to make a purchase, which is a drastic increase of 29.3% from the previous year. This has inspired companies like Reliance and Amazon India to come out with their own digital wallet. Flipkart has already introduced its own digital wallet.
Security
Consumers are not required to fill out order forms on each site when they purchase an item because the information has already been stored and is automatically updated and entered into the order fields across merchant sites when using a digital wallet. Consumers also benefit when using digital wallets because their information is encrypted or protected by a private software code; merchants benefit by receiving a combination of protection against fraud, faster receipt of payment, decreased transaction costs, and decreased theft loss.
Digital wallets are available to consumers free of charge, and they're fairly easy to obtain. For example, when a consumer makes a purchase at a merchant site that's set up to handle server-side digital wallets, they type their name, payment and shipping information into the merchant's own form. At the end of the purchase, the consumer is asked to sign up for a wallet of their choice by entering a user name and password for future purchases. Users can also acquire wallets at a wallet vendor's site.
Most, if not all digital wallets offer advanced security features e.g. biometric authentication and encryption, this protects the financial information of the users thus preventing fraud.
European Payments Initiative
With the acquisition of iDEAL, European Payments Initiative (EPI) Company has announced that it will create an all European digital wallet.
See also
References
- Clark, Sarah (11 October 2012). "NTT Docomo to take Japanese mobile wallet global". NFC World. Archived from the original on 20 November 2017. Retrieved March 23, 2013.
- Barrett, Randy (February 8, 2023). "Digital Driver's Licenses Are Finding Their Way to State and Federal Agencies". FedTech. Archived from the original on November 1, 2023. Retrieved November 1, 2023.
- Kang, Baoyuan; Shao, Dongyang; Wang, Jiaqiang (2018). "A fair electronic payment system for digital content using elliptic curve cryptography". Journal of Algorithms & Computational Technology. 12 (1): 13–19. doi:10.1177/1748301817727123. ISSN 1748-3018.
- Miklesh Prasad Yadav, Madhu Arora (2019). Study on impact on customer satisfaction for E-wallet using path analysis model. International Journal of Information Systems & Management Science. SSRN 3369651. Archived from the original on 26 September 2022. Retrieved 26 September 2022.
- Murphy, David. "Dunhill Wallet Uses Biometrics". PC Magazine. Archived from the original on October 2, 2017. Retrieved March 23, 2013.
- "Dial M for money". The Economist. June 30, 2007. Archived from the original on January 15, 2013. Retrieved March 23, 2013.
- "PayPass Adoption Study". MasterCard Advisors. Archived from the original on March 1, 2021. Retrieved March 23, 2013.
- Chanchani, Madhav (7 March 2016). "Amazon India planning launch of digital wallet in a bid to build online payments business". Archived from the original on 31 January 2019. Retrieved 27 June 2017 – via The Economic Times.
- "Top Five Emerging Trends in Procurement - SIPMM Publications". publication.sipmm.edu.sg. 2018-08-17. Archived from the original on 2023-04-06. Retrieved 2023-04-06.
- "Dutch payment processor iDeal to become European standard | NL Times". nltimes.nl. Archived from the original on 2023-06-29. Retrieved 2023-04-26.
- "EPI Company announces iDEAL and Payconiq acquisition". thepaypers.com. Archived from the original on 2023-04-26. Retrieved 2023-04-26.
- Dumitrescu, Irina (2023-04-25). "[GLOBAL] EPI Company announces acquisitions, additional shareholders and the coming launch of its new instant payment solution". European Payments Initiative. Archived from the original on 2023-04-25. Retrieved 2023-04-26.
- agency, Acato Digital (2023-04-25). "iDEAL Becomes More Ideal". iDEAL. Archived from the original on 2023-04-25. Retrieved 2023-04-26.
External links
- RFC 4112: ECML specification
