The adoption of digital payments is expanding worldwide due to the global increase in smartphone and internet users and technological advancement. The Statista report claims that in 2020 digital payments became the largest segment within FinTech with a global transaction value of $5.204 billion, and it is expected to grow to $154.1 billion by 2025.
According to the annual Global Payments Report by Worldpay from FIS, cash payments fell by half or more in Canada, Australia, the U.K., France, Norway, and Sweden. The study also reveals that about 40% of in-store payments in the Asia-Pacific region are executed through digital payments.
Against the backdrop of rising digital payment activity comes the rise of digital wallets which account for about 10% of payment methods in North America, 8% in Middle-East-Africa, 7% in Europe, and 6% in Latin America.
Digital wallets are also in high demand among the unbanked population in developing countries. Such markets are a unique opportunity domain for digital payments services providers since existing solutions don’t cover the needs of these countries populations, so there is still room for new wallets.
Why Does the Market Need More Digital Wallets?
The global FinTech market continues to evolve and is predicted to grow at a GAGR of 23.58% by 2025. The robust integration of technologies into financial services leads to constantly emerging market demands dictated by customers. Look how changing environment affects the FinTech domain:
• The emergence of cryptocurrencies launched the race for crypto wallets.
• The COVID pandemic drove the adoption of safe contactless payment technology.
• E-commerce growth set off wide usage of online payments.
• Today’s generation, especially millennials, prefers to have faster, more flexible, and more convenient payment methods.
You see, every new financial trend or lifestyle change causes a technological response in the form of a new product, service, or process. And whatever the trends are, service providers have to adjust to create and deliver value to their clients. A lack of trust in the traditional banking industry, demand for access to alternate financial services, and lots of underserved areas of banking are among other reasons for FinTech rise. To sum up, it’s clear that new solutions are still needed and they will continue to emerge.
eWallet Winning Features
Bringing more similar solutions to the market is pointless. To enter a niche and outwit the competition, a new digital wallet solution must stand out from others. It might be a unique feature much needed by the target audience, enhanced security, the lowest fees, or whatever else that would become a competitive advantage of a new wallet.
For sure, there is no single formula for an e-wallet that would be loved by millions. Yet there are some winning e-wallet features that would enable your solution to deliver the best user experience possible and differ advantageously from your competitors. Let’s point these features out.
✅ Simple registration
You never get a second chance to make a first impression, and when it comes to digital wallets, that very first impression is the simple and quick registration process. Did you know that the majority of your mobile app sign-in drop-off rate is caused by the complex registration process itself?
Your solution may offer a unique and helpful feature, but eventually, it all comes down to the experience the users have interacting with your product. Provide users with a streamlined and well-designed registration process that would take just a few taps, otherwise, they will switch to a more customer-oriented product.
The ever-increasing popularity of digital wallets is driven not only by their convenience and ease of use but their enhanced security. Losing a wallet or having it stolen can be a blast as one’s has to cancel all their cards and then get them reissued. But this is not the case with e-wallets; they are inherently more secure than conventional payment methods.
Advanced security of users’ money and sensitive data must be your top priority if you want your wallet to be a blast. When one makes an in-store or online payment via a digital wallet, only a unique transaction identifier or token is exchanged, not their account information. Still, there are many threats like impersonation, SIM swapping attacks, phishing, malware attacks, etc. So consider cybersecurity carefully before getting down to the ewallet development.
And take into account that human error is still very much the driving force behind an overwhelming majority of cybersecurity problems. Consider an algorithm impacting users’ security awareness to help them protect their data and money. It can be popups with relevant tips on enhancing the account security, notifications offering to update the password, or whatever else you can come up with.
✅ Fast transactions
One of the principal advantages of digital wallets is high transaction speed. Unlike traditional bank transfers when the recipient has to wait for money from several hours to a few business days, digital wallets allow wiring funds to the recipient’s account in a matter of seconds. Instantaneous and simple transactions made in a few taps are what make e-wallets a better choice for users so high transaction speed is a must for such an app.
✅ Low fees
Lower exchange rates and flat fees for some transactions or functions compared to traditional bank services are another competitive edge of digital wallets. Fewer service and transaction charges mean broad availability and an audience of millions of people. Make sure to consider your pricing policy to combine two objectives – monetize your app properly and make it profitable for users.
✅ User-friendly design & navigation
When it comes to user experience, the role of UI/UX design and intuitive navigation can not be overemphasized. According to CBI, 17% of startups fail due to unfriendly product design. By user-friendly design, we mean an easy-to-use app that has a unique visual appeal, engages users and interacts with them. If an app is well-designed, it is easy for users to start with and understand how to use it.
As for navigation, it has to be clear, logical, and well-structured to enable users to make transactions quickly. Isn’t that what they expect from a digital wallet?
According to the 2020 Google Cloud’s FinTech Focus Report, only 6% of FinTech startups break even, but you can improve your chances. For this, you should build a digital app keeping your customers in mind. Apply a customer-centric approach, create customer personas, build customer journey maps – all these activities would help you to dig deeper into the target audience’s needs and wants and to better understand how to solve their problems with your product.
✅ Reward programs
Reward programs are all about clients’ loyalty which is vital when you expect users to entrust your app with their money and sensitive data. Reward programs can become a powerful tool for acquiring and retaining customers, increasing brand awareness, and enhancing customer experience.
The essence of a reward program boils down to providing greater value for each transaction. This can be reached via multiple options – offer cashback to users, reward new users after registration, affiliate program, enable users to pay via earned rewards points, etc.
✅ Connected with crypto trends
Although there are specific wallets intended for cryptocurrencies, it wouldn’t hurt to add to your e-wallet app some of crypto wallets’ functionality. It is a way to cover a larger audience and open up new horizons of possibilities for users. Cryptocurrency payments are profitable for both businesses and individuals due to protection against fraud, fast international transactions, and financial transparency. Thus, connecting your app with crypto trends will equip it with another robust competitive advantage.
How to Create an e-Wallet – Itexus Expertise
Having a rough idea isn’t enough for getting down to the ewallet app development phase. To give your digital wallet a good start, undertake some preparatory work.
• Define your target audience. The same functionality can be delivered in different ways depending on the target audience of the app. Make sure to explore the economic, social, and cultural context of your targeted users to verify your hypothesis and adjust your idea according to your findings.
• Analyze the market. You might find similar solutions, and if that’s the case, think twice before entering the market without a unique feature. Competing with solutions that have already gained clients’ loyalty would be successful only if you can offer something much more valuable for users.
• Create customer personas and journey maps. A customer-centric approach is what helps to design genuinely good solutions. Even one comprehensive customer persona can provide you with a wide range of insights about your target audience, their needs, motivations, and pain points. And outlining a map of the journey users will take while interacting with your solution can help you better understand the experience they get at each stage of their journey, grasp their expectations, and identify areas for improvement. That is how great ideas come.
• Build an MVP. When it comes to building a digital wallet, it’s essential to validate the app concept first instead of rushing to develop it right away. Building an MVP allows you to test a product idea, assess the validity or invalidity of your business plan, save time and money, avoid building the wrong product, and reduce numerous risks.
Once you’ve done preparatory work, it’s time to move forward with your app. Building an e-wallet app that would be loved by millions requires a skilled development team with strong expertise in the FinTech domain and a proven track record of delivering successful digital wallet apps. Itexus has helped multiple clients to build and deliver to the market next-generation financial solutions. Feel free to check out our latest FinTech projects to get inspired for crafting your own.
Personal Finance Assistant App
We took advantage of Machine Learning and Artificial Intelligence technologies to create an intelligent money management system that helps users to make proactive and rational decisions on their finances. The app’s core feature is predicting future budget distribution by analyzing users’ spending records. In a nutshell, the solution enables users to keep track of their regular spending and strengthen financial literacy. To learn more about the project, please read the case study.
Money-Saving and Personal Finance Assistant App
A Silicon Valley startup partnered with Itexus to create a money-saving app that would help users to form healthy financial habits. We enriched the app with gamification features and equipped it with social functionality to enable viral marketing by enabling users to invite and challenge their friends and share the challenge results. To learn more about the project, please read the case study.
Mobile Bank Transfer App
Itexus was assigned to develop a mobile app-to-bank transfer solution for a US-based startup. We created and delivered to the market iOS and Android apps that facilitate sending money from US-issued bank cards to Nigerian bank accounts. The apps also allow paying bills, managing several bank cards in one account, etc. To learn more about the project, please read the case study.
Mobile Banking App for Migrants
This neobank solution crafted for an American entrepreneur is designed specifically for migrants and other unbanked audience segments. The app facilitates monetary transactions like financial help to families, getting paychecks early, micro-loans, etc. To learn more about the project, please read the case study.
In 2020, contactless in-store payments via digital wallets exceeded cash payments for the first time. By 2024, the usage of traditional payment methods such as cards and cash-on-delivery is predicted to account for less than 40% of e-commerce transaction payment methods. The trend is that digital wallets progressively displace traditional payment methods. The ever-increasing popularity of mobile wallets is driven by their convenience, flexibility, better security, and ease of use so digital payments adoption will expand.
Meanwhile, the financial software market still requires more solutions. Got an idea and want to create a digital wallet? Take a shot at your chance to enter the fast-paced financial software market and lead the race for e-wallet solutions. Contact us to turn your vision into a feature-rich and high-performing digital wallet that would be loved by millions.
By Itexus Team