What's a digital wallet and how does it work?

The online payment landscape has transformed over the last decade, with more and more consumers heading online to buy.

And businesses are capitalizing, shifting focus to the potential for 24/7 sales on a worldwide basis. Whether a SaaS product or retail store, the need to make payments fast, easy, and secure has never been higher.

For users and merchants, e-wallets are ultra-convenient, secure, and they allow you to streamline daily life.

But if you’re new to this form of payment and still prefer using your credit cards, how does this all work? And do you even need a digital wallet? Read on for all the essential details.

What’s a digital wallet?

A digital wallet is like a traditional wallet, but it’s an electronic device that securely stores all of your payment details on one app. It falls under the category of alternative payment methods.

So, yes, your payment information is stored on your phone. But you can access your account with a tablet or computer.

You can use one to complete electronic transactions, such as buying from an online shop or ordering a service.

Using a digital wallet, you can:

• Add funds into it so you can pay for things.
• Link your bank account directly to your e-wallet.

For example, with the FasterPay app you can buy products or services online, in other apps, or in local stores.

This is where the flexibility of a digital wallet is so beneficial in day-to-day life.

You can head into a shop and pay for items with a tap of your device, minus any cards and with more safety features. We’ll explain these details for you further below.

But do you need an e-wallet in your life? Well, they’re rapidly growing in popularity. In America, for example, at least 110 million people have used one in the last few years.

The incredible convenience, matched with cutting edge security features, allow consumers to pay for goods in fast and efficient fashion.

And for businesses, digital wallets allow for easier transactions for customers. This can increase conversion rates by effectively guiding customers towards their transaction goals.

What are the differences between a digital wallet, mobile wallet, and e-wallet?

There are no differences between a digital, mobile, or e-wallet. They’re all the same term! You may also hear some people call them a “digital card wallet”.

It doesn’t make any difference. They all complete the same payment functions.

How does a digital wallet work?

Your digital wallet functions like your traditional wallet, but it opens up many new opportunities for you to buy and sell goods across the world.

For users and merchants, they can greatly simplify your daily spending needs and offer new and secure ways to manage your finances.

So, is it easy to use a digital wallet? Yes, they’re designed to be very user friendly. FasterPay, for example, also has useful tips to guide you through the features you need.

But the likes of sending and receiving money are straightforward and don’t need you to have an extensive knowledge of computer software!

How do you get a digital wallet?

It’s easy! All you need to do is download your digital wallet app of choice.

For example, with the FasterPay app it’s free and straight from the Apple or Android stores. We also offer a desktop version for the PC/laptop fans out there.

Once you’re setup, there’s an intuitive process in the app where you can quickly send and receive funds worldwide. Here’s a closer look at how that works.

How to use a digital wallet

So, now you may wonder, “Where can I use a digital wallet?” Well, that’s the magic of the likes of FasterPay—you can use them in exactly the same way as your old wallet.\

Digital wallet services include the option to pay:

• Online.
• In stores.
• In-app purchases.

At FasterPay we have two types of digital wallet accounts—business and personal. To help you differentiate between the two, here’s an overview of the main features available.

Digital wallets for businesses

One FasterPay business account provides your organization with enterprise-level banking features. Including:

• Multi-currency accounts in over 20 countries.
• Easily send and receive money worldwide.
• FasterPay debit card linked to your multi-currency account.
• Accept mass payouts and payins.
• Easy transfers to non-FasterPay accounts.
• White label card issuing.
• 24/7 customer support.

These are the advanced features that make your business’ finances operate faster, securely, and with far-reaching capabilities.

For example, with the multi-currency feature you can open accounts in over 20 currencies and with the current exchange rates. This means you can easily convert funds into local currencies, a big boost for any business with global sales efforts.

Additionally, white label card issuing is a major benefit for businesses with a large number of employees as the cards help your workforce keep track of expenses. Your bu

They’re also a big help for specific industries, such as the tourism sector.

But FasterPay is much more than this. It's also a payment processor (a global payment gateway provider) that you can integrate into your checkout. Once you're signed up with us, it's easy to do and you don't need any coding experience.

All of this is manageable from one business account. For your customers, it means a streamlined and flexible payment process with localized payment options across the world. This means you can scale up with our platform and reach new markets.

Consumers can accept local payment methods, wherever they are in the world, streamlining your sales funnel and reducing churn rates.

If you'd like to learn more, we have a full guide on this topic: How to use FasterPay for business.

Digital wallets for users

With a personal account, a user can top-up an account with a credit card or bank transfer. You can also send money to other FasterPay users.

So, some of the key features you can use include:

• Instant wallet-to-wallet transfers.
• Multiple withdrawal channels.
• Currency conversions at a fixed rate.
• Low transfer costs.

To top up your account, all you need to do is use your card to add funds. Or you can use any other local payment method available.

There are 150 local payment methods available. These include your e-wallet, pre-paid cards, bank transfers, and cash.

The FasterPay app also features a smart algorithm that’ll choose the best payment method available for you. And it does this in real-time.

So, if you need to make a quick and secure payment all you need to do is login to your account and select whichever feature you need to use.

Examples of using a digital wallet

There are a wide variety of uses e-wallets have that financial companies provide consumers.

In fact, there’s much more to them than the very basics you’d expect them to perform.

Below, we break these down into personal account holders and business account holders. Both of these offer different uses to individuals and merchants.

User account examples

• Topping up your account with funds from your bank.
• Paying for an item in a retail store.
• Paying for an item on a website.
• Selecting a local payment option of your choice from your app.
• Sending funds to another FasterPay user.
• Receiving funds from another FasterPay user.
• Converting funds into a different currency.

Business account examples

• Integrating the software into your payment platform.
• Offering local payment options for customers around the world.
• Storing all your receipts in your electronic records.
• Tracking every single transaction on one platform.
• Issuing white-label cards to employees with pre-paid amounts.
• Make transfers to single, or multiple, accounts.

Are digital wallets safe to use?

Is a digital wallet safe? Yes, e-wallets offer a very high level of digital wallet security. Much more so than if you continue to carry around your debit and credit cards.

As effective as your cards can be at making payments, should you lose one (or misplace it even temporarily) then you can expose your personal information and be at risk of fraud.

E-Wallets offer the very latest security measures to block such possibilities.

For example, with FasterPay we use a variety of features to add multiple layers of security onto every account. This includes:

• Touch ID access: Use fingerprint ID to gain access to your account.
• Two-Factor Authentication: Add an extra layer to security measures with a security push notification straight to your smartphone.
• Passcode: Set a memorable passcode on your account.

It’s important to remember your card details aren’t stored on the FasterPay app. Instead, you have a unique code set to your account.

So, even if you lose your phone you don’t have anything to worry about. Your finances will remain safe and secure in the FasterPay Vault.

This means you don’t have to store your card details on the app, saving you from having to enter your number every time you want to buy something.

Want to find out more? Check out our guide on why FasterPay is safe for users and merchants.

The benefits of digital wallets

E-wallets have a wide variety of enterprise-level features. These simplify financial requirements and help you make payments quickly and easily.

But the advantages of digital wallets involve much more than pure speed and efficiency. Here are some of the main reasons why you should turn to a digital wallet.

Increase your financial security

Although some users may still have concerns about using an e-wallet, they provide an exceptionally high level of safety.

As we’ve mentioned already, you’ll have access to options such as passcodes, two-step authentication, and fingerprint access to your account.

What’s more, when you make a payment with your account your details are encrypted. So, the business you pay knows less about you. And this keeps your personal information secure.

Ultra-convenient

Credit cards first launched in 1950 and soon became the norm for most transactions. Particularly in recent decades, life without them seems almost unthinkable.

But as lightweight and effective as they can be, cards are far from ideal.

They have to slot into your wallet. As we all have a lot of them, this means your wallet is often bulging with many other cards, loose change, and notes.

It can make paying for a simple transaction very fiddly, especially if you have to locate a loyalty card amongst a mass of others.

Instead, digital wallets provide an even greater level of convenience and a payment method much closer to modern expectations of ease and security. Using one, you’ll find a new level of financial freedom.

This is because e-wallets simplify all your requirements into one app.

Everything is on one account on your phone—all you need to do is make a gesture, or scan your phone, and the payment is complete.

You also get to avoid filling out your card details with every online transaction. Instead, the information is stored and sent in the blink of an eye.

Flexibility with global currencies

FasterPay makes worldwide e-commerce requirements easier. Merchants have access to multiple business accounts in over 20 (and counting) currencies.

Wherever merchants and users are in the world, making a payment is quick and simple. No delays, just make your payment.

And this is the same for personal account holders, where paying for items across the world is simplified with over 150 local payment options.

So, the advantages for e-commerce sites is a reduction on churn rates through flexible payment practices.

Mass payouts and payins

Along with merchants sending payments to partners, vendors, and suppliers from one account, you can make single and mass transfers.

This makes it easier than ever to manage your receivable and payable funds—all in one place.

The app makes it simple to track every single transaction and it does this in real-time. You have full access to a platform that offers fund management and distribution.

24/7 customer support

In the case of FasterPay, we offer all of our customers access to an all-day, everyday call centre.

Whenever you have a question, all you need to do is get in touch for a quick answer.

How to use digital wallet apps

Digital wallets are designed to be easy to use. FasterPay, for example, has an accessible interface where you can complete any payment requirements quickly.

However, before you get started you’ll need to verify your identity. This is a legal requirement and you can’t start using the app until you’ve confirmed who you are.

But once you’ve uploaded a few documents (ID and proof of address), you’re free to use the e-wallet app as you need.

You can also check out our guide to using FasterPay for advice on tips on how to make the most of our app.

Time to try out FasterPay

Setting up your FasterPay e-wallet is safe, secure, and ultra-fast. You can find the FasterPay pricing plans to see the charges involved.

Like all the best digital wallet apps, it’s available on:

• Google Play.
• App Store.

You can also create a desktop account, either a FasterPay personal or business account.

Any questions? We have our 24/7 customer support team waiting to answer them: support@fasterpay.com.