5 Predictions About the Future of Digital Wallets
The E-Commerce Path
By some estimates, 70% or more of all e-commerce transactions are abandoned at checkout, valued at roughly $18 billion a year. There are many reasons for this ... But no one likes the 16-digit hunt-and-peck. No one. Which is why the onramp for digital wallets is likely to come, not in the form of mobile transactions in cafes and gas stations, but rather, online, because, ironically enough, that's where the friction is.
— Tech writer Jeffrey O'Brien in a recent Mashable.com article sponsored by V.me, Visa's digital wallet.
Source: Mashable.com
Race to the Top
Banks should think twice before going down the path of launching their own branded independent wallets. For some, it might make sense, but many others will likely be better off focusing on making their payment credentials available and top of wallet in the wallets already out in the market, as well as enhancing and extending their mobile banking platforms with value-added services, including payments.
— Zilvinas Bareisis, Senior Analyst with Celent Banking Group and author of a recent study called "Digital Wallets: Crossing the Chasm between Online and Offline."
Source: Celent
Regulator Wanted
As soon as a regulator is hired to regulate the wallet directly, it will be one of the best days of my life!
— Ben Milne, CEO and co-founder, Dwolla, in response to a question about how increased scrutiny from financial services regulators might affect the digital wallet business on this week's episode of InformationWeek's Valley View.
Source: InformationWeek's Valley View
It's All About Data
It's about providing an entire shopping experience and ensuring people get relevant offers for what they are buying. And that doesn't happen unless you have data.
— PayPal President David Marcus, speaking to reporters this week on the pivot role that data, analytics and customized coupon offers will play in digital wallet competition. PayPal reported that mobile payment volume rose 196 percent on Cyber Monday earlier this week compared to last year.
Source: TechCrunch
Security Considerations
Mobile wallet leaders are not well-defined, so there's a mix of technologies that haven't been fairly implemented or tested, at least from a security standpoint. An infected device can potentially compromise most mobile-wallet implementations.
— Javelin's security, risk and fraud analyst Alphonse Pascual, in a recent online interview about securing digital wallets and mobile payments.
Source: Bank Info Security
Jonathan Camhi has been an associate editor with Bank Systems & Technology since 2012. He previously worked as a freelance journalist in New York City covering politics, health and immigration, and has a master's degree from the City University of New York's Graduate School ... View Full Bio