Mobile wallets have already become the newest trend in the market. With the advent of the COVID19 pandemic, people experienced social and economic lockdowns around the world. Cashless shopping and e-wallet adoption are some of the best and most secure solutions for both consumers as well as for companies for exponential growth altogether.
Mobile wallets are proved to be a wonderful opportunity. The people are accepting it with the rise in its popularity and convenience. Physical wallets have almost been replaced with mobile wallets and you can boost financial inclusion with mobile wallets by integrating them into your business. But as they say, new opportunities come with greater challenges. In this article, we will understand what is a mobile wallet and what are the challenges and issues are involved with mobile wallet solutions.
What is a mobile wallet?
A mobile wallet is an electronic payment method that can be used when purchasing goods or services on a smartphone; either online or in-store where NFC (Near Field Communication) technology is used. Mobile wallet is the primary beneficiaries of e-payment solutions in digitization.
There are many mobile wallets currently available in the market. In the last 2 years, people are reluctant to use cash in stores to ensure social distancing and many have moved to tap their smartphones instead. This results in a clear shift to mobile money solutions and digital commerce over traditional cash payments.
The mobile wallet payment system is broadly adopt by users and growing exponentially regardless of the type of your business. Market insights depict the exponential rise in mobile wallet app development and how intellectually mobile wallet market transactions surpassed $120 billion in 2021.
Using a mobile wallet for day-to-day transactions can provide your customer with easy accessibility, quick and timely payments, quick transfer of funds, and lots of convenience with just a tap on their smartphones. However, technology is still facing some issues and challenges to overcome. Let’s peek into some of the challenges and issues faced by mobile wallets.
Challenges and issues with e-wallet
There are many challenges mobile wallets services are facing that could impact your business.
Other than some technological challenges, many other issues are being face when you are working towards mobile wallet app deployment. These are:
This is the most important issue you should take care of while introducing your mobile wallet app. Trust, as the name suggests requires more attention as to your users who are more conscious while uploading all their payment data to one place. With growing reports of hacking incidents, ransomware attacks, data leaks, etc., consumers are more concerned and showing trust issues towards mobile wallet payment systems.
More availability among retailers and merchants
It is not fully available worldwide. Consumers found that mobile wallets are inconsistent with many retailers and merchants, so they stick with cards. The number of merchants which accept payments from an electronic wallet depends on the actual wallet you choose. You can increase your mobile wallet availability among your target audience.
Security Risks or Fraud
Risk Security is one of the prime concerns of most consumers. People who are unfamiliar with mobile wallets are easily foole. Digital wallet payment risk is associate with data theft, data leak, hacking, etc. This fraudulent risk is one of the main reasons why many individuals avoid e-Wallets payments.
You can provide and aware your customer of the encryption methods your mobile wallet app is feature with like two-factor authentication, biometric authentication, and other relate security features. Transaction pin and password features can add more authenticity to your mobile wallet app. This may help your customer to feel secure and safe from fraudulent activities.
Encourage Reckless Spending
Some people struggle with spending habits and it increases when the money is electronically base instead of hard cash. People find their budgets have been disturb if they rely more on e-payment solutions. It can produce hesitation among your customer to use a mobile wallet more frequently.
You can provide your customer a limit order feature, you can enable your users to select fix exchange rates as per their choice and transaction will take place when that fix rate has been achieve.
Conventional customer mindset
Customers have used traditional methods of spending cash, cheque payments, ATM cards, credit/debit cards for a long time. They are comfortable and have strong mindsets to conduct their tasks with these conventional methods. Changing their mindset in using mobile wallets is vital to expanding the market.
Many users think that mobile wallet is too complicate to use and not meant for them. Proper awareness of mobile wallet trends among your target customers with advertisement campaigns and other methods may raise the credibility and reliability that could help them to adopt this new technology in a better way.
Finance and money are strictly regulate by government authorities or central banks. You cannot provide certain mobile wallet services if the government does not allow them. You should select a mobile wallet app development company that is familiar with all the regulatory norms and standard compliance of your targeted country.
Rewards or Cashbacks
Many consumers are happier with the coupons, prizes, discounts, and cashback offered to those who pay with credit or cash. Unlike cards and cash-back schemes,mobile wallet doe not offer any benefits. Financial marketers who want to increase the use of e-Wallets should take advantage of the opportunities.
It is always difficult to come out of your comfort zone and implement new technologies. However, there is great scope when you have such a vast market and people are adapting the e-payment solution wholeheartedly. The challenges we have discuss above can be easily overcome with technologically advance solutions.
Mobile and digital wallets are the future of online payment methods and you need to ensure that your business should get the transition of this new norm. The online business is growing exponentially and e-payment systems are receiving different acceptance levels throughout the world. So it is the best time to resolve the issues and challenges involved and be a part of this explosive growth with effective integration of e-payment solutions in your business.