Are E-Wallets Replacing The Actual Wallet?
E-Wallets have become a part of our day-to-day life.
It has made our life easier by offering so many services under one platform.
If we want to transfer money to someone, we open don’t open our physical wallet anymore, we open our e-wallet and transfer money instantly!
This is just one of the many services offered by e-wallets.
Our life has become hassle-free with the use of these wallets and also. The way we make payments has revolutionized.
Nowadays, many of us prefer keeping balance in our e-wallets rather than keeping cash in our physical wallets because of the user-friendly platform offered by e-wallets and the fact that it solves our problems by keeping the exact change needed every time we purchase something.
Why E-Wallets?
E-wallet stands for an electronic wallet.
This wallet is a type of electronic card which is used for online transactions done by the user through a computer or a smartphone.
The utility of this wallet is the same as that of a credit or debit card. Except it’s easier!
An e-wallet is linked to the individual’s bank account to make payments.
The main goal of an e-Wallet is to make easy and hassle-free monetary transactions. E-Wallets help in making faster and more secure payments, as well as online money transfers.
We just have to register ourselves and complete the KYC (Know Your Customer) in order to start using the services offered by the e-wallet.
Types Of E-Wallets
1. Closed Wallet
Closed wallets are wallets that are delivered by a company to a consumer for purchasing goods and services completely from the company that is offering the wallet.
These types of wallets cannot be used for purchasing goods and services from some other website, and the amount in this wallet cannot be withdrawn or redeemed. Example: Ola Money.
These types of wallets have become popular and are used by many e-commerce sites. Shopping websites like Flipkart and Amazon provide their own e-wallet, which can be used for buying from their website.
Travel booking websites like Goibibo and MakeMyTrip also offer a similar type of wallet to their users, and the balance in the wallet can be used for booking through their website or app.
2. Semi-Closed Wallet
Through semi-closed wallets, we can shop & transfer virtual money to anyone in the same wallet network. Semi-closed wallets also allow us to transfer the wallet balance to our bank account.
These wallets have recently become very popular in our country. The wallets are making online shopping very easy and facilitating secured payments.
Paytm is a semi-closed wallet that has become very popular in our country. It has tied up with retailers across the country and is accepted as a mode of payment by most outlets.
Apart from that, it also facilitates electricity bill payment, flight booking, bus booking, mobile recharge, movie ticket purchase, etc.
Recently, they have also come up with a facility for its users to invest in mutual funds using their platform. Another semi-closed wallet that is used in India is free to charge and offers a wide range of services through its app.
3. Open Wallet
Open e-wallets can be issued by banks only and can be used for buying goods and services. It is very similar to a credit card, up to the pre-funded amount.
These wallets can also be used for taking out cash from ATMs or banks and for fund transfers.
Example: M Pesa by Vodafone India with ICICI Bank
You may also want to read 10 Digital Banking features you need to know about
Conclusion
India is experiencing tremendous growth in digital financial transactions.
It all started as a convenient mode of payment for booking cabs and ordering meals. Now, mobile wallets are present in smartphones, especially post-demonetization.
From bill payments to transferring money, India has seen a huge transformation in the way we have started preferring e-wallets over physical wallets.
Today, I can step out on the road without any money and still travel, still buy a meal, and return home without any inconvenience!
This is just the first step. There’s more to come.