Could you believe that just over a decade ago, a smartphone was considered as one of the most impressive gadgets introduced in the market? When it was officially launched, it became the hottest topic in town. And if anyone happened to be the first few lucky ones to own it, they definitely would have stolen a few glances and attention from the people around them. Even though everyone was fascinated by the new features and the tricks that it could do, a typical consumer would not have expected how far it could have evolved, or even predicted the milestones it has achieved today. Needless to say, back then it was a second priority to many, or at least, did not carry as much importance to us as it does today. As we step into the last quarter of 2018, many would agree that smartphones are becoming increasingly “undetachable” in our lives. In fact, for most people, it dominates most of our time and plays an integral role in our daily activities.
All thanks to time and technology, smartphones today have proven to us that they are capable of raising our standards of living. Not only do they carry a much greater value and influence, but it is also almost as if we could not live without them. In fact, it has become one of the many first things that we use every day. From waking up in the morning to leaving the house, our phones are the key item that we pay attention to. To say, that it leaves us in distress if we leave them behind, would be an understatement. It even goes to the extent of gradually replacing the next most significant item to everyone - our wallets. As wallets start to integrate with smartphones, it is becoming more common for people to carry less cash. To put it in simpler words, our smartphones have also transformed themselves into mobile wallets, or also known as e-wallets.
How are e-wallets shaping the future?
While more consumers are gradually adopting e-wallet payment services, we should not forget how the evolution of payment practices has contributed to this phenomenon. From ordering pizzas through phones to purchasing movie tickets online, its most recent transformation has allowed payment to be made via e-wallet. It does not take much to guess what a traditional wallet consist of - cash, debit or credit cards, identity cards and etc. Apart from having to carry around a bulky wallet, your concerns also increase as there are chances of forgetting any of these items in your wallet. However, shifting your payment method to e-wallet lifts the burden off your shoulders as all the information are stored in your smartphone. Moreover, it is very unlikely for anyone to leave without their phone these days.
To make it more clear, try to picture this in your head. You are in a restaurant and you have just finished your meal. As you called for the bill, you walk to the cashier to make the payment. But, instead of paying with cash, you pay it via e-wallet - a mobile app that can be loaded with money where you use it to make payments for good and services. However, this scenario in Malaysia is still far from being a common practice among the locals. Just like the rest of the South East Asia (SEA) region, the adoption of advanced payment options is at infancy stage. According to reports, locals still prefer to pay with cash or bank cards due to the lack of eagerness to use smartphones as a device to pay.
As a matter of fact, research shows that digital wallet penetration in the country only accounts for 11% so far. Nevertheless, this does not shatter hopes for Malaysians to opt for e-payment solutions. Evidently, based on the numbers, it shows that Malaysia still has room to grow its offerings and services of smartphone e-payment solutions. Furthermore, Bank Negara’s introduction to Reduced Merchant Discount Rate policies can be seen as an initiative to support minimal cash usage in the nation.
E-wallets: A win-win situation for customers and sellers?
Even though e-wallet payment services are slowly making their mark as a form of payment method, we can’t deny that cash still remains to be an imperative necessity for consumers live. In spite of that, e-wallets are still a favourable payment option to some customers and business owners. Here’s why:
- Elevating your shopping experience - When it comes to shopping, there is nothing more dreadful than making payments for your orders. This is especially true for online shoppers as they are in the race against time to complete their purchase by filling up their personal information before the session expires. The circumstances are, however, different for e-wallet users. It makes the entire shopping experience much more pleasant as shoppers save the hassle of filling in the fields of an online order form. As for merchants, this also adds to their advantage as it reduces the risks of customers abandoning their purchases last minute if they find the whole process to be too tedious.
- Expect incentives and promotion - One of the notable differences between cash and e-wallet payment lies in the presence of incentives and promotions. There are very few to limited rewards when shoppers pay with the cash unless they purchase in large quantities which would then entitle them with discounts. As for e-wallets, consumers can expect to be pampered with a variety of perks. In fact, each e-wallet service provider comes with its own set of loyalty programme and rewards system. It can come in forms of discounts, cashbacks, point collection, shake rewards or even free gifts. Shoppers are more likely to return to the same store if repurchasing allows them to earn these incentives where they can utilise it for their next purchase. Hence, companies can strengthen bonds and create loyal customers when they integrate e-wallet payment solutions to their businesses.
- Forget about going to the ATM - Ever been in a situation where you find yourself frantically looking for an ATM machine just because your wallet ran low on cash? Worse still, you will find yourself stuck in a sticky situation when you realised there is insufficient cash to pay for your food in a place where it is only cash friendly. Apart from adding on to our fears, it also leaves both buyer and seller in an awkward situation. Unless both parties do their parts by adopting e-payment solutions, it would be a challenge to completely eliminate this occurrence in the future. And this is especially true when most people are now carrying less cash with them. With e-wallet, it creates a win-win solution for both parties; consumers could save up the trouble of searching for cash and stores could attract more customers when alternative payment solutions are offered.
- Quick transfer of funds - It is usual to have times where one of our friends would offer to pay the bill first. The next action would then proceed with splitting the bill accordingly and the common practice involves paying the other party by cash. Now, besides taking the effort to calculate the bill, the tricky part comes in when there are insufficient cash or loose change to provide those who paid extra. While some would offer to transfer the amount via online banking, others would suggest that they pay for it the next time. However, this does not guarantee that everyone would be mindful of their debt. Moving forward with e-wallet, it makes transferring and receiving funds much easier. Users have the flexibility to send money directly via the e-wallet app without any transaction fee or dealing with painful online banking processes.
Steering towards a cashless society
As we continue to embark on the 21st century, we have to agree at some point that e-wallets are one of the innovations that are driving us towards a cashless society. While not everyone would be adapting to this initiative, it does not mean that the nation should refrain itself from accepting new ideas and developing its people. On top of making payments and transactions more convenient and reliable, digital payments are also creating more opportunities for business operators and its customers. It is difficult to tell when exactly the nation transforms itself into a completely cashless society, slowly but surely we will get there one day if we all play our respective roles.
If this article caught your interest and you would like to know more about e-wallets and possibly adopt one for your business, we are always happy to have a discussion with you and provide the most optimal solutions. Feel free to reach out to us.
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