Mobile wallets have evolved into a true alternative to conventional credit cards and bank accounts. Using mobile wallets, consumers can quickly pay for their purchases without the need to carry cash or cards. When compared with cash and other payment options, mobile payment wallets provide a number of benefits to their users.
The top 5 benefits of using a mobile wallet are:
No Need to Carry Cash
Mobile wallets make it possible to make all kinds of payments without the need to carry cash. Mobile wallets are accepted even at smaller merchants who generally do not accept credit and debit cards. In developing countries like India and China, mobile payment wallets are accepted even by hawkers and small merchants. This make them perfect alternatives to cash.
Mobile Wallets are Safe
When compared with other payment options, mobile wallets are safe to use. Cash and credit cards can be lost while carrying them. Moreover, information on credit cards could be easily stolen and misused. Despite the new rules passed by RBI which made it compulsory to authenticate each purchase transaction through a PIN or a password (for online transactions), there is no protection against the misuse of credit cards with international merchants. In the case of mobile payment wallets, access to the data stored in them is restricted through a PIN that is set by the user. Even in case of loss of the phone, many mobile wallets have the option to erase the information remotely. Hence, mobile wallets are safer than the other alternatives.
Inculcate Credit Discipline
Many shoppers indulge in shopping binges by using their credit cards and fall into a debt trap. Use of mobile wallets will prevent customers from falling into a debt trap. Since mobile wallets generally have limits on the amount that can be loaded on to them, they will prevent shoppers from doing impulse purchases and falling into a debt trap.
In App Purchases
All leading mobile payment wallets provide the facility to make in app purchases of movie tickets and mobile recharge coupons. Use of mobile wallets will do away the need of installing separate apps for making these purchases. Since the purchase and payment is made from the mobile wallet itself, it makes online transactions safer.
Access to Discounts and Special Offers
Since the penetration of mobile wallets is still very low in countries like India, providers of mobile wallet services have entered into tie-ups with third party merchants to provide steeper discounts and higher number of special offers for purchases made through their mobile payment app. Users of mobile wallets can benefit from these limited period promotional offers. Mobile wallet providers like Paytm in India provide special discounts and cash back offers on purchases made using their app.
Given the benefits of using mobile wallets listed above, you too can start using wallet as an alternative for making small payments. According to a recent report in Wall Street Journal, the total mobile payments in China reached $9 trillion in the year 2016. Given that the banking system in India is also under penetrated, the usage of mobile wallets is bound to grow in the near future.
