Digital Wallets for E-Commerce Businesses
Digital wallets provide consumers with an easier and safer way to shop online by eliminating the need to enter credit card details on every merchant website. These mobile payment apps can store multiple card details as well as loyalty cards, discount coupons and tickets that shoppers wish to store within them. Depending on its type, wallets may require entering passwords, biometric data (like fingerprint scanning) or NFC in order to complete purchases.
Most major banks and credit card companies now provide digital wallets such as Apple Pay, Samsung Pay and Google Pay. These apps use encrypted data with a unique transaction code to protect customer privacy from hacking attempts; additionally they’re device independent so users can access them on any smartphone, tablet or computer device.
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Consumers favor digital wallets for multiple reasons, including convenience and security. According to a 2021 survey by ClearSale, 71% of shoppers regularly or occasionally used one when making online purchases; of those using digital wallets in this fashion, 66% believed it provided greater protection than keying in their credit card numbers manually on websites.
Digital wallets provide numerous advantages for both consumers and merchants, but failing to properly manage digital wallet risk may prove costly for e-commerce businesses. Chargebacks may cost a business upwards of $20 per order plus any related shipping, fulfillment, or processing expenses; additionally they may damage trust among future customers and make future business harder than before.
Digital wallets provide consumers with greater security than typing credit card details on a website, since their unique tokens don’t correspond directly to actual card numbers – making it harder for hackers to gain access even if their phone is lost or stolen.
However, digital wallet security depends on the security of its host device. Hackers could still gain entry if the host device were compromised and take information from multiple wallets located therein.
One of the key aspects of offering digital wallets for business use is keeping its anti-fraud defenses up-to-date. Screening digital wallet orders similar to card payment orders will help minimize fraud and maximize conversions. If an order seems out of the ordinary or raises red flags for manual review, merchants should review past purchases from that customer to identify any patterns which might indicate fraud – having these safeguards in place will help safeguard both their business and reputation.
