The United States is home to one of the very first digital wallet: Paypal. The company was founded in 1998 and is now a major player in digital finance. But their inability or reluctance to reduce fees has encouraged a host of new and cheaper mobile wallets:
- Venmo — Free P2P payments, owned by paypal
- Google Pay — Free P2P and merchant payments with card
- Square Cash App — Free P2P payments, no fee from debit card
- Zelle — Free instant P2P payments direct from major banks
- Apple Pay — Used with debit card is free P2P and merchant payments
Venmo adopted the social media approach. In fact, just like wechat pay, venmo users can have a friend list. Users also have the option of publishing their transaction on their timeline.
What make Venmo so viral it’s probably its fee structure and its speed. Transfers within Venmo users are free as well as withdrawals through bank accounts. Transactions are fast and safe and the withdrawal threshold is US $3000 per transaction. Although Venmo hasn’t publish figures on its number of users, Verto Analytics estimated the wallet has around 7 million active users.
Google developed a fiat based electronic wallet released in September 2015. Google Pay is available to any Google account user in US, UK and India and it’s very simple to use:
Add a payment method, debit or credit card to your G Pay wallet; every time you make a purchase, Google will convert your money into token that will be sent to the merchant. This way, merchants have no access to customer’s personal data. Google Pay has partnered with banks, POS terminal providers and card issuing companies, to provide cardless payment, and electronic transfers. G Pay has 24 million active users.
Launched in March 2015, Square Cash is a mobile app that allow users to transfer money using a unique username known as cashtag. The application, which has been rebranded as Cash App records about 7 million active users as of early 2018.
Transactions within Cash App ecosystem are free and withdrawal can only be done through credit and debit cards
Europe is the best example of economic and social integration in the World. It is home to several digital payment solutions operating cross-border and seamlessly. Among the famous electronic wallets and digital payments services in Europe, there are Skrill and Neteller, solutions offered by Paysafe Group the online payment giant. These later have a strong establishment in the continent.
Cross Border Remittances
While most most mobile wallets are used domestically, cross border transactions have seen improvements in speed and price. Multiple new companies like Transferwise and Xoom help in a variety of new channels. The average cost of sending $200 in 2018 via a mobile channel is just 1.7%. The cost to send the same was 10% in 2008! The high fee monopoly Western Union and MoneyGram had is giving way to very reasonably priced and convenient cross border money moments.
Conclusion — if it’s free, you are the product
While consumers are reaping the benefits in convenience and cost, what are they giving up? Fintech players worldwide have seen the success of Alipay and WeChat pay and their Big Data operations. Being able to sell the purchase patterns of a society more than makes up for the loss in transaction fees. Consumers need to realize just what personal data they may be giving up.
To know that the government has access to the identity of any political donation done thru one of these digital wallet platforms, might give some people pause. It’s here in cases of government and corporate malfeasance where citizens may want to turn to a more decentralized and private mobile currency option — Cryptocurrency.
While the wallet in your pocket may be with you for a few years and the main home of your national ID card, digital identity is on the way, and will soon make a wallet, a piece of yesteryear.
As mobile wallet plays a vital role, Roamsoft introduces a digital wallet platform “R Pay” with customer app, merchant app, end- to- end admin panel. If you want to possess your own digital wallet solution then R Pay is the right choice.