The expansion and progress in IT have led to the rapid penetration of smartphones. And this smartphone revolution has led to a rapid move towards payment features. The future of the mobile wallets is progressively taking shape as a kind of payment method. This mobile money system is now severely competitive with conventional banking firms, making the payment industry highly competitive. Recent surveys indicate that consumers' awareness has increased the use of mobile payments.
Amazon Pay, Apple Pay, Google Pay, and Android Pay are among the successful mobile app payment services. These apps' success stories included securing mobile payment systems, consumer awareness, and facilitating financial transactions and retail purchases. Yet there are some challenges that face mobile wallet integration.
Opportunities and challenges related to integrating mobile wallets include:
Opportunities
1. Rural Locality:
Rural areas always have a significant impact on any country's overall economic and monetary development. However, most inhabitants of such remote areas lack basic financial facilities such as bank accounts. But with time the opportunity for a better online payment solution can be expected if the penetration of smartphones and the internet will be increased in a rural locality. By using a mobile wallet, they can create a bank account without being physically present at the bank.
2. Customers Engagement & Loyalty:
In every business, customers are becoming more engaged with brands that are loyal to them. The same applies to digital payment trends. The actual reason for mobile payment usage is loyalty, not payment. Therefore top app development companies can achieve customer engagement by offering customer loyalty and reward programs within the mobile wallet app.
3. Expansion Of Smartphone Ownership:
Nowadays every second person is buying a smartphone, and the number is constantly increasing. As the number of smartphone users has increased, so has the number of mobile wallet users. Due to the convenience and rapidity of money transfers, more people tend to make a cashless payment. Thus, the interest of mobile payments is increasing among smartphone users.
4. Mobile Banking & Versatile Mobile Payment App:
An increasing number of banks are now offering versatile mobile banking services to their customers. Most of the mobile owners use this mobile money system to transfer funds, check their balance and recent transactions. It catalyzes the use of digital payments. FinTech digital solution providers have also introduced innovative digital transaction software.
Mobile Remote Deposit Capture is one of the most popular and widely used applications. By utilizing this app, customers can easily submit their check by taking a photo and emailing it to the bank, resulting in efficiency and convenience for the bank and the consumer.
Challenges
1. Regulatory Adherence:
Digital wallets and payment applications must comply with the highest security standards and legal requirements under governmental jurisdiction, which entails both financial and consumer-based regulations. This may be an issue for new entrants looking to invest in a new market.
2. Potential For Fraud And False Representation:
Fraud risks are one of the many reasons why consumers avoid using e-wallets. There might be many unknown risks and scams in the contactless payment system such as leaked data, hacking, undetected malware, e-wallet vulnerabilities, etc. Therefore whenever you hire a remote developers team, make sure that the development of their e-wallets is not vulnerable and not a threat to the financial security of consumers.
3. Lack Of Knowledge:
There are still many people who believe that mobile wallets are not convenient and they do not provide any reliable solution. They still don't know the advantages of mobile wallets over the use of cash and credit cards. Therefore most people still use credit/debit cards for online payment and purchases.
4. Less Trust In Mobile Wallets:
Customers are now ready to conduct online transactions, but the level of trust in digital payment mode is still a concern. Therefore FinTech digital solution providers must provide agile digital payment solutions with a high level of security to give customers a certain level of confidence.
According to YouGov's research, 43% of mobile users do not trust mobile wallets. 38% of people are afraid that if they lose their mobile devices, they won't be able to make an online payment. According to Auriemma's survey, consumers who use mobile wallets will not refer it to their friends or family.
5. Zero Rewards:
Mobile wallets usually lack reward policies. Since mobile wallets do not offer discounts and bonuses, customers are less interested in e-wallets. Whereas using cash or credit cards, they offer discounts, rewards, and coupons. Therefore, to increase customer base, financial marketers should offer rewards and loyalty programs to customers.
Future Of Mobile Wallet Integration:
● Money transactions will be heavily dependent on remote purchases.
● Competition between NFC based contactless wallets and QR code based wallets.
● Artificial intelligence powered automated payments will become mainstream.
● Enhanced security will be achieved through tokenization and dynamic cryptograms.
Final Thoughts:
The world is becoming more and more digital. People are ready to experiment with new technologies and they also want to make use of digital currencies. In recent times, many software development companies have emerged, which will help mobile wallets to become complete financial management tools.
Users are already making the best use of these tools, but going forward, there will be a big threat to security as more and more users will be attracted to hackers to take control of mobile data. Besides, the demand for a convenient payment method will keep growing and it will stimulate the use of mobile wallets.
Nikunj Gundaniya, Product manager Digipay.guru, one of the leading digital wallet app development company USA, which provides mobile finance application development services. He is a visionary leader whose flamboyant management style has given profitable results for the company. He believes in the mantra of giving 100% to his work.
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