WHAT ARE MOBILE WALLETS? HOW DOES IT WORK

What are Mobile Wallets?


A mobile wallet is a type of payment service through which businesses and individuals can receive and send money through mobile devices. It is a form of e-commerce model that is designed to be used with mobile devices due to their convenience and easy accessibility. Mobile wallet is also known as mobile money or mobile money transfer.


A mobile wallet is a virtual wallet that stores payment card information on a mobile device. Mobile wallets are a convenient way for the user to make in-store payments. A mobile wallet primarily enables a person to pay as well as receive payments using a mobile device. Typically, mobile wallets are offered through several payment processing models. Which are but not limited to the following:


Mobile-based billing - Through this, the user usually sends / receives payment through their mobile service provider.


SMS-based transactions - In this, the transaction is initiated by sending an SMS short code. In this case the payment can be credited / debited from a configured bank account, credit card or mobile service.


Mobile web payments - This allows a user to send / receive payments through the mobile app.


Near-field communication (NFC) - It uses specialized hardware built into a mobile device to interact with a mobile app and payment-processing terminal.


WHAT ARE MOBILE WALLETS


What is mobile wallet technology?


Smartphones are easily available these days and there is an app for everything. The "mobile wallet" technology is becoming more popular every day. This is a technique through which you can keep your debit or credit card information in digital form in your mobile. Instead of using your physical plastic card to make purchases, you can also pay using your smartphone, tablet, or smartwatch.


Types of Mobile Wallets


Mobile wallets are classified into three main segments: Closed Wallet, Semi closed wallet and Open Wallet.


Closed Wallets


Closed wallets are associated with a merchant or private company where you can use the money to purchase directly from a specific merchant. When the service provider puts some amount in the user's wallet for the services of his company, then that money can be used only to buy the product of that company. Money from these wallets cannot be transferred to your bank account. Examples of these wallets are Amazon Pay and Ola Money, Flipkart, Snapdeal etc.


Semi Closed Wallets


Under Semi Closed Mobile Wallet, you can shop online and take any service. But you cannot remove the cache from it.


Semi Closed Mobile Wallets can be used with many merchants as long as they have a contract with a payment portal. Examples of such wallets are Paytm, Freecharge and Mobikwik.


Open Wallets


This type of wallet can only be issued by the bank. They allow you to buy goods and services, withdraw cash at ATMs and transfer funds. That is, through this type of mobile wallet, you can withdraw money through ATM and other means. The money in this wallet can be used for any transaction and users can withdraw money sent to their account in cash. Examples of these mobile money wallets are PayPal and Vodafone M-Pesa.


HOW TO WORK MOBILE WALLET


Customers can access all store information by opening an app on their phone, entering a PIN, password, or fingerprint, and then selecting the information they need to access. The app uses communication transition technology such as Near-Field Communications (NFC) to interact with ready-to-pay terminals in mobile wallets.


- Mobile wallet securely stores your credit or debit card.


- It can also store your loyalty cards, coupons, tickets etc.


- It communicates with terminals using various technologies.


In a mobile wallet, you have to transfer money through your bank account, debit card or credit card or recharge it. Do you know that mobile wallets are both prepaid and post-paid buy prepaid wallets need to be recharged so that you can use this money for payment. If you are not able to use the money for a few days, then it will be returned to your account. But in a post paid mobile wallet, the account is linked to the wallet itself. Therefore, when you spend money from your wallet, the money will be directly deducted from your bank account at the same time.


How to use Mobile Wallet


To use this wallet, first you have to open your account in the wallet that you want to use and it is mandatory to have a mobile number. After registering in this service, money can be transferred to the wallet with the help of debit or credit card and then at the time of purchase you can use the money wallet with the help of smartphone or mobile.


Advantages of Mobile Wallet


  • Easy Access: Using a mobile wallet for transactions is really simple. And for this you just have to download the app and create a user ID and password. This is as easy as logging into your Gmail or FaceBook account from your smartphone.
  • Adding or loading money is simple: you can easily add money to your wallet with net banking, credit card or debit card. This can save you time in going to the bank, queue etc.
  • Wallets or any other type of wallet can be stolen or lost anywhere but a mobile wallet is neither stolen nor lost.
  • In mobile wallets, the money is stored as per your requirement and you do not have to share your debit or credit card details often. So, your money is safe.
  • Some of the time payments made through cash is a problem. For example, if you have to pay a bill of Rs 480.50 which is not in a round figure, then you may face difficulty but payment can be done easily with a mobile wallet.
  • It is not possible to carry cash every time, but you can shop anywhere, anytime from a mobile wallet. People who forget to carry their ATM card with them again and again. Mobile wallets are a very good way to pay for them.
  • You can use the auto feature to automatically make future bill payments from your wallet balance on a pre-determined date.

Disadvantages of Mobile Wallet


  • Mobile wallet technology is easy to use for those who are technology friendly and require a high-speed internet connection. Therefore, we can say that mobile network connectivity is the biggest obstacle.
  • Mobile wallet service is better for those who are technology friendly.
  • The mobile wallet has a limit of spending money and depositing money that has to be spent on a daily basis.
  • It does not meet the needs of the entire population. Most of them are using ordinary cell phones. Plastic money and m-commerce have not yet fully taken hold across the country.

Various e-wallet / mobile wallet companies in India



E-Wallet/ M-Wallet

Industry

Company

Bank Transfer Allowed?

Mobile Platform

Overall Rating (based just on online platform)

Paytm

Private

One97 Communications

Yes

Androis iOS, Windows Phone, Ovi, Blackberry

4.4

MobiKwik

Private

One MobiKwik Systems Private Limited

Yes

Android, iOS, Windows Phone

4.2

Oxigen Wallet

Private

Oxigen Services India Pvt. Ltd.

Yes

Android, iOS, Windows Phone

3.7

Citrus Wallet

Private

Citrus Pay

Yes

Android, iOS

3.9

ItzCash

Private

Itz Cash Card Ltd.

Yes

Android, iOS

4.4

Free

charge

Private

Snapdeal

No

Android, iOS, Windows Phone

4.3

Axis Bank Lime

Banking Industry

Axis Bank

No

Android, iOS, Windows Phone

3.6

Airtel Money

Telecom Industry

Airtel

Yes

Android, iOS

4.2

ICICI 

Pockets

Banking Industry

ICICI Bank

Yes

Android, iOS

4.1

Jio Money

Telecom Industry

Reliance

No

Android, iOS, Windows Phone

4.2

mRupee

Telecom Industry

Tata Teleservices Limited

Yes

Android, iOS, Windows Phone

3.7

SBI Buddy

Banking Industry

State Bank of India

Yes

Android, iOS

3.9

Vodafone M-Pesa

Telecom Industry

Vodafone

Yes

Android, iOS, Windows Phone

4.2

HDFC PayZapp

Banking Industry

HDFC Bank

Yes

Android, iOS

4.0

 

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