If you have ever gotten to the checkout line at the store only to realize that you’ve left your wallet at home, you are not alone! Thankfully, paying for transactions with your phone or other mobile device is becoming increasingly popular! As technology evolves, smart devices are becoming more and more pivotal in helping people tackle everyday tasks. Learn about digital wallets, how they work, and why your business should accept payments from mobile wallets!
What are Digital Wallets?
Digital wallets are exactly what they sound like! They are electronic versions of your physical wallet. Digital wallets are financial transaction applications allowing people to make payments using mobile devices. Beyond credit card information, they can store things like loyalty cards and tickets you’ve purchased. You can access this data from devices like your smartphone, smartwatch, computer, or tablet. Therefore, payments are quick and easy, and people can avoid carrying a bunch of physical cards around with them!
The most well-known mobile wallets are intended for general use and are broadly accepted by businesses of all sizes. These include digital wallets such as Apple Pay, Google Pay, and Samsung Pay.
How do Digital Wallets Work?
A digital wallet emulates a real, physical wallet by holding currency and keeping it handy for payments. A mechanism authenticates access and keeps transactions secure. Digital wallets ask users to enter their debit or credit card numbers which are then encrypted. After setting up the account, only the customer can access the wallet by entering their valid login credentials. Even if a user loses the device, no one else can access their wallet. However, an authorized user can access and use the wallet from any other device.
To make a payment from a mobile wallet, customers must keep their mobile device close to the card reader. A contactless payment symbol is often visible at the businesses counters which indicates that the store accepts digital wallet payments. Once the payment is authorized, the amount will be quickly transferred to the merchant! It’s truly quite simple!
Benefits of Digital Wallets for Businesses
Faster Service
Digital wallets improve checkout speed because consumers don’t have to spend time opening their wallets and searching for their credit card or cash. Instead, they can simply use their mobile device! For online transactions, checkout is much simpler because consumers don’t have to get up, find their credit card, and fill out all card information. With mobile wallets, they can use the app to complete their transaction with data already stored on their phone in seconds!
Reduces Errors
Sometimes, the cashier may enter the wrong amount in the card reader. Overcharging customers creates a negative experience while undercharging them can result in revenue loss. Digital payments can help to avoid this by keeping payments error-free, particularly if you’re using integrated payments.
Safe and Secure
Credit cards come with security risks, many of which are eliminated when using digital wallets! For example, since mobile wallets must be verified by the customer using a fingerprint or a PIN number, you don’t have to worry about your staff failing to match the customer’s name or signature to the card. Businesses also don’t need to worry about accepting fake credit cards, as without connections to a real debit account, digital wallets simply don’t work.
Offers Convenience
A digital wallet makes it easy to shop almost anywhere! If a customer forgets their physical wallet, they can simply pull out their phone to make a purchase. Digital wallets also make online shopping quicker and easier. Entering card information on mobile devices can often seem inconvenient, and more so if the webpage isn’t optimized for mobile. Digital wallets offer a smoother alternative, allowing customers to breeze through the checkout process!
Data and Insights
Digital wallets provide your business with valuable data and insights on customer spending habits, helping you make more informed decisions about marketing strategies, inventory management, and forecasting.
Can Earn Customer Loyalty
Some customers only like to pay using digital wallets. If your company is among a few in its industry or market that accepts mobile payments, then those customers will likely choose you over a competitor! Especially for Millennial and Gen Z shoppers, digital wallets are the preferred payment method.
Increases Revenue
The more payment options you offer, the more customers will complete their purchases at your store, restaurant, or on your site!
How to Start Accepting Mobile Payments at your Business
Secure digital wallets and contactless payment technology provides a layer of security and convenience that rivals that of physical credit cards. Mobile payments offer great opportunities for businesses and allow them to reach a wider market.
With technological advancements, the popularity of these payments has increased. Globally, over two billion people have made a purchase with a mobile device and these mobile point-of-sale payments are projected to reach over 6 trillion by 2028! Digital wallets will only continue to expand, and businesses must be prepared.
Never miss a payment again with Gulf Management Systems! GMS offers a full selection of merchant services tailored just for your business. Accept credit card payments at your shop, restaurant, online, or in person. Our powerful payment solutions include software, point-of-sale equipment, credit card readers, payment gateways, and other software integration tools for your website or shopping cart.
- Accept Visa, Master Card, Discover, or Amex
- Set up one-time or recurring member billing
- Connect your existing eCommerce website with Authorize.net or NMI
- Utilize our virtual terminal, point-of-sale equipment, or software
- Get the lowest merchant rates in the industry
- Assure that your business is PCI compliant
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