What is a mobile wallet?

A mobile wallet or e-wallet is a cloud-based application that can be used to make payments. In addition to money, the wallet can also store cryptocurrencies, address information, membership cards, travel tickets, and other important information that would normally be found in a physical wallet. The wallet can be used, for example, to transfer money to a friend, send payment requests, or split a restaurant bill among a party.

Mobile wallets are roughly divided into two categories

  1. Cloud-based online wallets created for customer use to make purchases from affiliates. The chains’ own applications, where payment is made online, also fall into this category. For example, Espresso House’s Coffee Card, as well as the large online stores’ own payment systems.
  2. Consumer’s device-bound wallets that are commonly used for payment or money transfer, online and in applications, or on a stone leg as a near payment. This group includes mobile wallets such as ApplePay and Pivo, which use card tokenization and NFC technology, as well as online payment services such as Paypal and Click to Pay.

Electronic wallets can differ greatly in their implementation technologies and features, but their goals are largely the same: The aim is to make payment fast, smooth, and secure.

Money can be deposited to the electronic wallet without connecting a bank account by making a prepayment, or money can be transferred by connecting a payment card to the application. You can also use a phone number, e-mail address or nickname to transfer money.

Through the eyes of the consumer

From the consumer’s point of view, the availability of an electronic wallet depends on the terminal in use, and in the case of an application tied to the terminal, also on the service selection of one’s own bank. The payment method is most often used alongside a physical payment card or cash as an alternative payment method.

According to data collected by the Bank of Finland, the value of mobile payments for everyday purchases made on a mobile device increased by 62% in 2020 compared to the previous year, when the pandemic encouraged consumers to pay special attention to hygiene. Using mobile payments to pay for everyday purchases is more popular among young people, but users are found in all age groups and the trend is growing. As many as 93% of Finns had tried mobile payment by March 2021.

Development by rapid leaps

Electronic wallets gradually landed in Finland, first to pay for online purchases and then also to retail stores. For example, the highly popular mobile wallet MobilePay was launched in Finland in 2013 and Apple Pay in 2017.

The number of payment applications developed by the chains themselves has also clearly increased. For example, Hesburger and Espresso House have invested in development by combining the payment feature with their loyalty app.

Are you looking for a payment partner?

Seitatech ensures that the payment transactions in your system run smoothly and reliably. Our operations always adhere to the highest safety standards so that our partners can be sure of the continuity of their business. We handle card, card and electronic payments. For more information, please contact Mikko Laaksonen.

Mikko Laaksonen, Head of Technology

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