Wednesday, March 14, 2012

Make Way for the eWallet/Virtual Wallet/Mobile Wallet

By Michael Scheibach, Executive Editor, BankNews

I don't know about you, but I'm simply trying to stay up with all the developments in mobile banking, which has gone from account lookups and money transfers, to mobile payments via an ewallet -- also called a virtual wallet or a mobile wallet.

The new FIS Mobile Wallet is a cloud-based payment solution that can be built into any financial institution's existing mobile applications. This approach reinforces the bank's brand while building customer loyalty. Another key feature is its use of QR, or quick response, technology for payments. This makes it much more usable by merchants, who don't have to update terminals.

 “The new solution is unique in its ability to support existing smartphones and existing point-of-sale hardware, while still being forward-compatible with new technology as it becomes available,” said Doug Brown, FIS senior vice president of mobile financial solutions. “This enables financial institutions to launch a mobile wallet today, and to attract and retain customers via their own financial institution-branded mobile payment solutions.”  

For more on the FIS Mobile Wallet, click here.

UPside Visa, introduced by Plastyc, is another an iPhone/Android app targeted toward the youth and under-banked markets. UPside Visa mobile apps provide a full range of personal banking needs, including activating a new account, signing up for direct deposit, redeeming cash back points, paying bills, transferring funds to friends, issuing paper checks, checking balances and reviewing transaction histories. 

Of course, we also have Google, Isis, Sprint and Paypal moving ahead with their respective versions of the ewallet.

The key to ewallet success is not acceptance by banks. They, in fact, have gone all in. Rather, it is with retailers. And not just the major ones. For the ewallet to become the norm, all retailers must be able to accept mobile payments just as easily as credit cards.

FIS is using QR codes, which eliminates this obstacle. Other ewallets are based on NFC, or near field communications: wave a smartphone over an NFC reader to record a payment. One swipe and you're out of there.

NFC has been stuck in the promise stage for a couple of years now. But according to a new study by Juniper Research, "Mobile Commerce Markets," NFC will facilitate transactions valued at $74 billion by 2015.

Juniper Research states: "The increasing use of mobile devices as an alternative to credit cards and paper tickets is one of the fastest growing segments of the mobile commerce market. The report shows that the rapid adoption of mobile devices for commerce-related applications is by no means limited to NFC. All segments -- money transfers, banking, payments and coupons -- are forecast to exhibit significant growth rates."

"Our report demonstrates the spectacular growth we see across all segments of the mobile commerce market, said David Snow, author of the report. "Four of these segments (money transfer, physical goods, NFC and coupons) will more than treble in transaction value over the next three years, whilst digital goods, banking and tickets will still on average, double over the same period." 

For more on mobile banking and advancements of the ewallet, visit and subscribe to BankNews magazine, which is available as a digital edition and as a mobile app for iPhones and iPads.