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    Digital

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    © All Rights Reserved
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    38 views15 pages

    Digital Wallet

    Uploaded by

    vaibhav
    Digital

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    of 15
    ‘After studying this chapter, students will be able to: > Understand the concept of digital wallets, > Know the working of digital wallet, > Explain the types of digital wallet, > Understand the online plateform of digital wallet, > Differentiate between digital wallet and mobile wallet. 7.1 Introduction E-commerce is starting to pick up and gather pace, and, in this regard, digital payment services are in increasing demand. Mobile & online digital wallets are a relatively new concept, they are only at the beginning of their journey, and a great future is undoubtedly awaiting them. This payment method has been growing over the past few years, as numerous tech companies have introduced them to the marketplace, with names such as Apple Pay, Google Pay, Samsung Pay, Microsoft Wallet and many others. They represent a shift in paying for goods and services away from traditional cards and towards a more mobile form of payment. Most of these digital wallets work with the help of a technology known as Near Field Communication or NFC, and have also begun to integrate with check-out in mobile apps and e-commerce websites. In this chapter we are going to discuss the details regarding digital wallet. 78 || Personal Finance and Planning 72 Digital Wallet A digital wallet, sometimes called an e-wallet, is a service that allows you to pay for things, Usually through a mobile phone app. It also stores a number of other items a traditional wallet would hold, such as a driver's license, gift cards, tickets for entertainment events, and transportation passes Digital wallets are not only easier to use in some cases but are also generally considered to be more secure than a traditional wallet. By using a digital wallet, online Purchases can be done easily through computers, tablets or smart phones. In general, bank accounts of individual users are linked with their digital wallet. In a digital wallet system, user credentials are securely stored and verified during transactions. Digital wallets are not only used for online purchases but also for authentication of the user. A digital wallet can store complete user information including credentials, transaction history and personal details. Digital wallets can also be used in combination with other mobile Payment systems. Component of Digital Wallet A digital wallet has two components: 1. Software component: This provides security and encrypts the information stored in the wallet and the transaction that is being conducted. 2. Database component: This stores user-information and details like shipping address, billing address, payment method, etc. “There is another type of digital wallet available, which is known as a server-side digital wallet. Itis generally created by the organizations for users. ‘These types of wallets are gaining popularity as they are more secure, efficient and provide added functionalities, 7.3 Working of Digital Wallets Pisital wallet software is traditionally housed through a mobile app on a smart phone, but can also be used in a variety of other formats such as a physical device or on your personal computer. The smart phone app version of the digital wallet is by far the most popular today due to its flexibility and mobility, These digital wallets typically require you to download a digital wallet app on your smartphone. These can be created by your bank of choice or a trusted third Party. Make sure you do your research and confirm the company’s trustworthiness before providing your financial information t0 an app. Typically, you must find a point of sale (POS) system terminal that is compatible with your digit Walletin order to use it. Usually, you will be able to identify this through the contactless symbol displayed at checkout, Some POS systems also allow you to pay using Magnetic Secure ‘Transmission technology: While contactless payments can be more difficalt to find, many modern POS systems can suppot Magnetic Secure ‘Transmission Payments, Digital Wallet || 79 Once you find a POS system that is compatible with your digital wallet app, you can simply hold your ‘smartphone up near the sales terminal to pay. Sometimes you can even pay directly through your app. This rule can also apply to some ATMs, where you can withdraw cash from the app when in close proximity t0 8 compatible ATM. Digital Wallets Security ‘We all are concerned about our personal information. Major digital wallet apps are widely considered tobe safe. In fact, they are likely more safe than carrying your financial information and other sensitive documents in a physical wallet. ‘Additionally, all reliable digital wallet apps heavily encrypt their user’s payment information, making it difficult to compromise when the information is being transferred from the application to the payment system. This can actually help protect your information ifa retailer or company you purchase from has an information leak or hack. 74 Types of Digital Wallets ‘There are three types of digital or e-wallets depending on the delivery technology. 1. Closed wallets: A company that sells products or services can build a closed wallet for its customers, The money stored in this type of wallet can be used to transact with only that company which has issued the wallet. These wallets are online accounts where the money of refunds, cancellations, returns or gift cards are stored. Some companies earn interest on such deposits. One example can be that of Walmart pay. Semi-closed wallets: Even though the coverage area of such wallets is rather restricted, these are still prevalent in the system. This is because they can be used to transact online and offline and buy anything, This ranges from goods, services, payment of fes, to premiums, provided the merchants have a contract or agreement with the issuer to accept the payments. 3. Open Wallets: These wallets can only be issued by banks or non-banking institutes if partnered banks, These wallets serve a dual purpose of performing all the transactions of semi-closed wallets plus withdrawing. cash at ATMs or banks and transfer funds. 755 Online Platform of Digital Wallets Digital wallets have been slowly gaining in popularity over the years. There are a multitude of digital wallet apps to choose from, but which one is right for you. Here we are discussing some of the digital Wallet used by the customers. rv 1. Google Pay Asis part of the Google ecosystem they have scaled up their user base really quickly, inspite of being a late entrant, With Google Pay you can send money to friends, pay bills and buy online, recharge your 80 | Personal Finance and Planning ur bank account. Since Google Pay works with your existiy - all via UPI and directly from yot ; i Pea escourt which means joe money is safe with your bank. Theres no need to worry about rloadi, : iti = which is required for all the other apps. You cay lets and you don’t need to do additional KYC - wl rt 5 : ees ao cards and other rewards, with the cashback directly being transferred into your ban, account, 2. PayTM PayTM is one of the largest mobile commerce platforms in India, offering its customers a digital walle to store money and make quick payments. Launched in 2010, PayTM works on a semi-closed mode and has a mobile market, where a customer can load money and make payments to merchants who have operational tie-ups with the company. Apart from making e-commerce transactions, PayTM wallet can also be used to make bill payments, transfer money and avail services from merchants from travel, entertainment and retail industry. Capitalizing on the scope and growth of India’s education market segment, they recently partnered with premium educational institutions in India to introduce cashless payments for fees, bills and other expenses. 3. Citi MasterPass Citi Bank India and MasterCard recently launched ‘Citi MasterPass, India’s first global digital wallet for faster and secure online shopping. By using this, Citi Bank debit and credit card customers become the first in this country to be able to shop at more than 250,000 e-commerce merchants. It ensures fastet checkout with a single click or touch and stores all your credit, debit, prepaid, loyalty cards and shipping details in one place. 4. PayPal Paypal is another famous service that can send money between other PayPal users and friends, Available for both iOS and Android, you can easily send money to other users just like you would on the PayPal website, It also allows you to view your past transactions in detail. PayPal is also entering mobile Payments via a card reader with the PayPal 5. PhonePe hon isan all-in-one UPI-based digital payment app. It is one of the most popular digital wallets ind ‘The app is powered by Yes Bank and launched by Flipkart, two giants in their respective industries a © @PP crossed the 100 million user mark in 2018 and is growing day by day. You can do everything ough this app, from UPI payments to paying through the PhonePe e-wallet, from QR code paymett ‘o paying through your debit & credit cards. PhonePe is not just like any other digital wallets in India, has many featu res in the app that make your lives easier. Get great deals and cashback on bill payment food outlets, shopping, and much more through PhonePe, aad Digital Wallet || 81 phonePe assures data security against cyber-criminals. Along wit i «, 48 . : 2 . 1g with this PhonePe is a multi-lingual app. The app is available in English, Hindi, Marathi, Tami, Bengali, and more, Therefore making it easier for users to use the app seamlessly across the nation. 6. Amazon Pay ‘The Global Giant ie Amazon has developed its own digital wallet known as Amazon Pay: ‘The digital wallet was launched in 2007 globally. However, Amazon Pay was launched in India a decade later ie in 2017. More than 33 million people use Amazon Pays Digital wallet to make payments for various transactions. Previously Amazon Pay was only used to make payments when you purchase something from Amazon. Now Amazon lets you make payments through Amazon Pay while transacting with selected merchants. Amazon Pay also offers various benefits like discounts and cash back. Some of the ajor attractions of using Amazon Pay’ digital wallets is their brilliant general usability, mobile support along with a rich feature set. 7. BHIM This digital wallet is backed by The Reserve Bank of India (RBI) and launched by The National Payments Corporation of India. BHIM is probably one of the best digital wallets in India based on UPI. BHIM has played an important role in the quest to make India a cashless economy: ‘This digital wallet in India supports all the banks across the nation. Along with that BHIM lets you send and receive money using Virtual Payment Address (VPA) wherein you can transact without disclosing your bank details. Consequently, it also allows merchants to transact with customers by using fingerprint scanner which is obtained through the Aadhaar database. Also, you don't need to worry ‘about security issues as your login expires after 90 seconds of inactivity to minimize inappropriate and fraudulent use of your data. ‘Additionally, BEIM also provides you a transaction history to make sure that you keep a check on your transactions through the app. 8. ICICI Pockets ICICTis one of the leading Indian multinational banks. Currently, itis the largest private secior bank in India, ICICI Pockets is a digital-payment based app for mobile phones. The app uses a virtual VISA card to enable users to transact on any website or ‘mobile across the nation. The ICICI Pockets e-wallet is not let through any bank account. ‘The apps just limited to users of ICICI bank, you can fund your digital wal digital wallet lets you transfer money, split expenses, book entertainment tickets, and do much more with one of the best digital wallets in India. ‘And since this e-wallet uses virtual VISA, you can transact on any app or website in India. The digital wallet app allows users to send money to any phone number, Facebook user, bank account number, ‘and email ID. To make this process fun and social, ICICI Pockets ‘uses your Facebook credentials to Jog in. 9. JioMoney JioMoney, launched recently in 2016 by Jio, of digital wallets in India. Similarly, the Jio isa digital payment app. The app is inspired by the concept ‘Money app lets you get all the benefits of cash. With Jio 82 || Personal Finance and Planning Money, one can receive great discounts and offers. Users can also bookmark their frequently visit, 4 retailers so shopping can be made quicker than usual. The best thing about Jio Money is that it ay be used by people who do not have Jio as their telecom service provider. And if you own a Jio Lyp mobile phone, you get exclusive access to the app that is preloaded with discounts and offers from selected merchants. The JioMoney digital wallet in India also enables you to make secure digita) payments from anywhere. Along with that, the app is very easy for everyone to use and quite simple tg navigate. 10. HDFC PayZapp HDFC PayZapp is making digital wallets in India simplified. Consequently it is one of the top digital wallets in India with one-click payments. PayZapp is a complete digital payment solution. ‘The users can easily compare flight and hotel tickets and even buy music or pay bills with the app. Simply connect your debit or credit card once and forget to worry about making payments. It is probably on: of the best one-click payment solution digital wallets in India. And PayZapp lets you enjoy amazing offers at SmartBuy, you can send money to anyone in your phone book through their digital wallet in India, ‘The digital wallet app is fast, secure, and convenient to carry out digital payments. Above all, you don't need to re-load money again and again in your PayZapp digital wallets in India. Because once you link your Debit or Credit card, you wor't need to worry about reloading your e-wallet. Likewise, the app keeps your details secure with the bank and the data is not stored on any phone or website, Consequently, PayZapp conducts three security checks for each transaction by using proprietary technology. 11. Mobikwik Mobikwik is a Gurgaon based e-wallet payment system in India that helps its users store their money ‘Their payment system of digital wallet in India was founded in 2009 by Bipin Singh and Upasana Taku. Mobikwiks large network connects more than 25 million users with approximately 50k merchants through their payment system of digital wallets in India. ‘Their e-wallet payment system enables you to recharge, pay bills, book travel tickets, and make third-party purchases through MobiKwiks digital wallet. Similarly, the digital wallet app allows you to buy digital gold, insurance, get a personal loan on MobiKwik, and you can also invest in mutual funds through one of the best digital wallets in India, You can carry out transactions by adding money to your digital wallet through your debit card, credit card, net banking. Their service is not just limited until there, you can also opt for doorstep cash collection and use it to pay bills and shop through their digital wallets in India, 12. YONO SBI YONO SBIisa digital wallet in India that’s available in 13 languages. Subsequently, YONO is also aval for non-SBI consumers. It is one of the best digital wallets in India thanks to the national reach of fe State Bank Of India. With YONO SBI your convenience is met by making digital payments a hassle- ce process. The users can send money via the digital wallet of YONO SBI to other bank accounts, bo Digital Wallet \| 83 i or movie tickets and much more. Y hotels or fe ticl ‘ore. You can set a reminder fc ; “ rt ucan s for money transfers and dues through this app. Its one of the best digital wallets in India as it offers an additional service of + Sistine statements for the transactions that you carry out through YONOs digital wallets in India. ‘The app puts some of India’s largest range of goods and services at your fingertips. Similarly, the app Jets you invest and bank digitally, you can also book IRCTC train tickets, flights, and vacations through. the app. 13. Ola Money Olais one of the fastest-growing start ups in India and in 2015 it launched its own digital wallet. They've developed one of the best digital wallets in India. Above all, Ola money is amongst the easiest, fastest, and safest way of transacting through digital wallets in India. We can use this digital wallet to pay for your ola rides. Ola money has made cashless travelling a dream come true, However, you can also use ola money to buy groceries, flight tickets, and much more. ‘The Ola Money app lets you transact with your stored money on the Ola Money digital wallet at various online merchants. “The best thing about Ola Money's digital wallets in India is that you can withdraw your Ola Money toyour bank account. And the app also lets you avail offers with partner merchants like MyBusTickets, Similarly, Ola Money looks to partner with more and more merchants in the near future to give you more options to browse through the app. Merits of Digital Wallet Digital wallet offers: «A faster payment process, thanks to the non-requirement of specifying lengthy information, + Round-the-clock banking services. + Rewards and discounts. + An economical mode of conducting transactions. «The tracking of the status ofthe ordered commodities, especially with respect to ecommerce transactions. + ‘The maintenance of transaction record. + The remittance of bills. 16 Difference between the Digital Wallet and Mobile Wallet Digital wallet is a broad term for software that allows you to store your credit card numbers, debit card numbers, and loyalty card numbers in the cloud, then access them from a device like your laptop, tablet, orphone. Digital wallets can help you Pay when you're shopping online, transfer money between friends, or pay with your phone at the petrol pump. Digital wallet can be accessed on a desktop or laptop as well 8a mobile device. 84 || Personal Finance and Planning ‘A mobile wallet is a type of digital wallet that’s accessible through an app on a mobile devicy (usually a phone). You can use a mobile wallet to “tap to pay” when you're checking out of a store — , convenient alternative to paying with cash or carrying around a bevy of, physical cards. You can also add items like boarding passes and concert tickets to mobile wallets. . Define digital wallet? What are the component of Digital wallet? . What are the different types of digital wallet? }. List six online platform to use the digital wallet? . Are digital wallet safe for the customer for online transactions? . What is the difference between digital wallet and mobile wallet? Okey e gaa Security and Precaution against Financial and Online Frauds Learning After studying this chapter, students will be able to: » Know about ponzi scheme and precautions taken to avoid the ponzi scheme trap, > Understand the concept of phishing and its working, > Explain the steps to protect from phishing, > Know about credit card closing and skimming, > Understand the preventive measure to secure online payment. 8.1 Introduction Everything has gone digital, if something hasn't yet, it will soon. Entire businesses, organizations and Services have gone digital. Although technological advancement helps people to enjoy the advantages of cashless/ digital payment systems over others, but with technology comes its vulnerabilities, Digital cal transactions, while convenient also pose a threat to your money. There are risk involved in al and online banking as well. Every year, thousands of Indians fall victim to online financial fraud, ‘™' significant rise in the number of digital payments over the last few years, the incidence of online banking fraud has also increased manifold. In FY 19, more than $0,000 cases of fraudulent usage of debit cards, credit cards and internet banking to the tune of €150 crore was reported in India. Despite

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