digital wallet refers to electronic devices or online services that enable a person to make electronic transactions. This can include purchasing on-line items with a computer or using a smartphone to buy something at the store. Individual bank accounts can also be linked to a digital wallet. They may also have a driver's license, health card, loyalty card, and other identity documents stored on the phone. Credentials can be forwarded to the merchant terminal wirelessly via near field communication (NFC). More and more digital wallets are made not only for basic financial transactions but also for authenticating the holder's credentials. For example, a digital wallet can verify the buyer's age to the store when buying alcohol. The system has gained popularity in Japan, where digital wallets are known as "mobile wallets". A cryptocurrency wallet is a digital purse in which a private key is stored for cryptocurrency such as bitcoin.
Video Digital wallet
Technology
The digital wallet has software and information components. The software provides security and encryption for personal information and for actual transactions. Typically, digital wallets are stored on the client side and are self-managed and fully compatible with most e-commerce websites. A server-side digital wallet, also known as a thin wallet, is one created by an organization for and about you and stored on its servers. The server-side digital wallet is gaining popularity among major retailers because of the security, efficiency, and added utility provided to end users, which increases their satisfaction with overall purchases. The information component is basically the user input information database. This information consists of your shipping address, billing address, payment method (including credit card number, expiration date, and security number), and other information.
The digital wallet consists of a digital wallet device and a digital wallet system. There is a special digital wallet device like a biometric wallet by Dunhill, a physical device that stores cash and cards along with a Bluetooth mobile connection. Currently there is further exploration for smartphones with NFC digital wallet capabilities, such as the Samsung Galaxy series and Google Nexus smartphones using Google Android operating system and Apple iPhone 6 and iPhone 6 Plus using Apple Pay.
The digital wallet system enables the widespread use of digital wallet transactions among various retail vendors in the form of mobile payment systems and digital wallet applications. M-PESA mobile payment systems and microfinance services have been used widely in Kenya and Tanzania, while PayPass MasterCard applications have been adopted by a number of vendors in the US and around the world.
Digital wallets are increasingly used in Asian countries as well. One in five consumers in Asia are now using digital purses, representing a doubling from two years ago. A recent survey conducted by MasterCard's mobile shopping survey showed that 8,500 adults aged 18-64 in 14 markets showed 45% of users in China, 36.7% of users in India and 23.3% of users in Singapore were the largest users of digital wallets. The survey was conducted between October and December 2015. The analysis also shows (48.5%) of consumers in the region make purchases using smartphones. Indian consumers lead with 76.4% using smartphones to make purchases which is a drastic increase from 29.3% from a year earlier. This has made companies like Reliance and Amazon India come out with their own digital purses. Flipkart has introduced its own digital wallet.
Maps Digital wallet
Payments for goods and services purchased online
The client-side digital wallet requires minimal settings and is relatively easy to use. After the software is installed, the user starts by entering all related information. The digital wallet is now ready. On the purchase or check-out page of the e-commerce site, the digital wallet software has the ability to automatically enter user information in online forms. By default, most digital purses ask when the software recognizes a form that can be filled in; if someone chooses to fill out the form automatically, the user will be prompted to enter the password. This leaves unauthorized users away from viewing personal information stored on a particular computer.
ECML
Digital wallets are designed to be accurate when transferring data to a retail checkout form; however, if a particular ecommerce site has a strange checking system, the digital wallet may fail to recognize the form fields correctly. This issue has been eliminated by sites and wallet software using Electronic Commerce Modeling Language (ECML) technology. The Electronic Commerce Modeling Language is a protocol that determines how online retailers organize and prepare their payment forms. Participating ecommerce vendors that incorporate digital wallet and ECML technologies include: Microsoft, Discover, IBM, Omaha Steaks, and Dell Computers.
Digital wallet app
Consumers do not need to fill out an order form on each site when they purchase the item because the information has been stored and updated automatically and put in the order column across the merchant's site when using a digital wallet. Consumers also benefit when using digital wallets because their information is encrypted or protected by personal software code; traders benefit by receiving protection against fraud.
Digital wallets are available to consumers for free, and they are fairly easy to obtain. For example, when a consumer makes a purchase on a merchant site prepared to handle a server-side digital wallet, he typed the name and payment and shipping information into the merchant's own form. At the end of the purchase, the consumer is required to register his/her wallet of choice by entering a username and password for future purchases. Users can also get their wallet at the vendor's wallet site.
Although the wallet is free for consumers, the seller charges a fee for the wallet. 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 transactions between cardholders and participating merchants and charge a trader a fixed fee.
Benefits for ecommerce site
Over 25% of online shoppers ignore their orders out of frustration in filling out forms. Digital wallets combat this problem by giving users the option to transfer their information safely and accurately. This simplified approach to complete transactions results in better usability and ultimately more benefits for customers.
The Digital Wallet may also improve transaction security because the wallet usually does not provide payment card details to the website (unique transaction identifier or shared tokens instead). The more this approach is the feature of the online payment gateway, especially if the payment gateway offers a "hosted page payout" integration approach.
See also
References
External links
- RFC 4112: ECML Specifications: [1]
Source of the article : Wikipedia
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