Digital Wallets – Are We Drifting Away From Secure Payment System

Mobile wallets are driving us towards a cashless world and the future seems imminent when digital wallets will outpace other payment methods. Consumers are getting comfortable storing their debit/credit cards, prepaid cards, gift cards, and bank account information digitally on their mobile devices for the convenience of payment.

Below are some quick mobile wallet features catalyzing their popularity:

  • Mobile Payments
  • Mobile Credit Transfer
  • Bill Payments
  • NFC Payments
  • Account Transfer
  • Funds Transfer

It’s no secret that smartphones are opening new avenues for the payment industry through apps around everything that you can ask for. According to Worldpay’s 2018 Global Payment Report, the global mobile payments usage is predicted to increase by 28% in 2022 over 2018, surpassing credit cards and cash.

Globally, 36% of Smartphone users are responsible for making mobile payments. WeChat Pay is the world’s biggest mobile payment platform with 823 Million users followed by Ant’s 700 Million (formerly known as Alipay) and Paypal’s 277 Million users. Other payment apps like Apple Pay, Amazon Pay, Samsung Pay and Google Pay are also catching up fast.

Impact of M-payment on the US Market

In the current state of payment mode transformation, the adoption of mobile payments in the US is gaining momentum with 61.6 Million active users. Mobile apps by large corporations like Starbucks have become the most popular payments platform in the US with 23.4 Million users closely followed by Apple Pay. In the US, in-person use of digital wallets is expected to increase at a 45% CAGR to reach nearly $400 Billion in annual flows by 2022.

Use of e-wallets is expected to rise in the next 2-3 years.US in-store mobile payments are forecast to reach $128 Billion in 2021. Total transaction value of US digital payments segment amounts to $961 Billion in 2019 which is expected to cross $1.3 Billion by 2023.

What is Slowing M-payment Adoption?

Despite having one of the highest rates of Smartphone adoption in the world, almost 90% of US consumers prefer to pay by cash, credit card, or debit card due to security and data breach concern. Customers are becoming the victim of digital wallet fraud as criminals have tailored their attack for modern payment technology.

Contactless payment presents a huge fraud risk and data theft vulnerability, hacking, malware attack, and many unknown vulnerabilities. Sophisticated fraud attacks on digital wallets are making thousands of dollars disappear from the account in a blink of the eye and consumers feel reluctant to use mobile wallets under fear of fraud and data theft.

How QPS Looks At It

In the light of startling facts that the number of global internet users has reached 4 Billion in 2018 and are predicted to cross 6 Billion by 2022, data security is going to be a stiff challenge. Digital-savvy customers would definitely try out new innovations and prefer to use digital money. With technological advancement, cyber criminals are also upgrading themselves with new weapons like BOTS to extend their attack parameter to new payment landscape.

To deal with the increasing fraud threats businesses need a secure payment environment which can be trusted by new technology adopters. QPS’ 24×7 AI and ML driven transaction monitoring can detect fraud before it happens. Its multilayered FinTech solutions provide effective fraud detection, prevention, and secure payment processing to businesses.

QPS plays the role of an ideal aggregator delivering a comprehensive fraud defense for friction-less shopping experience for customers which will boost the use of mobile wallets for sure.

 

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