Coca Cola Launched The First Digital Wallet In 1997

By October 30, 2019Blog

As the concept of money continues to rapidly evolve, it’s easy to forget that digital wallets and payments aren’t really that new. In fact, the digital wallet concept has been around for over 20 years.

Coca Cola is credited with launching the world’s first digital payment system back in 1997 with several vending machines in Helsinki. The soft drink giant created a digital payment processing system where customers could pay for their soft drink via a text message on their cellphone.

Today we’ll take a closer look at digital wallets, why so many consumers and businesses are using them, and some of the top 100 digital companies investors should know.

What is a digital wallet?

A digital wallet – sometimes called a mobile wallet or an e-wallet – allows consumers and business to process payments and invoices online or at the point-of-sale.

Because they use encrypted technology, they’re generally considered to be much safer and more secure than carrying around a traditional wallet, debit, or credit card.

How security in digital wallets works

Digital wallets used software that is housed within a mobile app, smartphone, notebook, laptop, or desktop computer. The wallets securely store consumer and business financial information that is heavily encrypted, making it extremely difficult for data to be compromised.

Benefits of digital wallets

Discover lists 8 reasons why the digital wallet payment method has been growing over the years:

  1. Convenience
  2. Efficiency
  3. Fewer items to carry
  4. Organization
  5. Enhanced security
  6. No paperwork
  7. Discounts and bonuses
  8. Lower transaction costs

It’s not just consumers who are embracing digital wallet technology.

A recent article in Inc. Magazine reports that point-of-sale digital wallet transactions in the U.S. alone are expected to top $300 billion by 2022, ten-times the transaction volume of 2016:

  • 30% of people in the U.S. say they spend more when using a digital wallet mobile app
  • 40% of consumers say they’re more likely to shop at a place that accepts digital payments
  • $1 trillion in retail sales were influenced by digital wallet mobile phone apps

15 of the top 100 digital wallet companies

As digital money continues to evolve, over 100 digital wallet companies are now providing services in the U.S. and around the world. Here are 15 of the top digital wallet companies to keep an eye on:

  1. American Express offers its customers digital wallet capabilities for in-store purchases and mobile online payment transactions.
  2. Android Pay is Google’s digital wallet app for Android smartphones.
  3. Apple Pay works with iPhones and the Apple Watch to securely hold credit and debit card information for point-of-sale purchases on in-app transactions.
  4. Bank of America partners with digital wallet providers for both consumer and business use with time tracking, invoicing, and payment processing.
  5. Biyo Wallet is an international company offering a biometric digital wallet that allows transactions with just a scan of your palm.
  6. Chase Paymentech provides digital wallet solutions to both consumers and businesses through Chase Pay.
  7. Fis is a global firm that provides digital financial technology and payment options for companies around the world.
  8. Google Wallet is a digital wallet service that can be used in the mobile app, desktop, or even with Gmail.
  9. Mastercard offers digital wallet features for consumers and businesses with point-of-sale and online technologies.
  10. Official Payments lets people pay bills, taxes, tuition, utilities, rent and insurance online without having to use checks or other physical forms of payment.
  11. PayPal pioneered digital payment processing and now has millions of users in over 200 countries and works with 26 different currencies.
  12. Samsung Pay works with newer versions of the Galaxy phone and is one of the most widely accepted digital wallets in the world.
  13. Stripe is backed by Sequoia and Andreesen Horowitz, has a private market valuation of $35 billion and includes credit card processing and funds transfer features in its digital wallet.
  14. TransferWise allows users to transfer money between countries electronically, with low currency conversion fees and transfer costs.
  15. Walmart Pay is a free digital wallet app for Apple and Android phones that works at all of the retailer’s 4,600 stores.

Other companies offering digital wallets and payments include Alipay, Authorize.net, Barclaycard, Brinks, Capital One, Cellum Group with its B2B services, Citi Bank, Coinbase, Discover, Facebook Messenger, and Wells Fargo.

Digital is everywhere

Factors driving the growth of digital wallets includes smartphone technology, demand for improved customer experiences, the need for fast and secure transactions, and lifestyle changes. Millennials – the largest living generation in the U.S. – are also the largest audience for digital payments, according to Business News Daily.

Technology innovators like Apple and Google, credit card companies and banks, and businesses of all shapes and sizes are using digital wallets and payment solutions to streamline processes, reduce transaction costs, and future-proof their business.

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