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Mobile wallets play a vital role to channelize the growth of Digital India. As our society wholeheartedly embrace the western culture, cashless transactions in no exception. Nowadays, people prefer using a Smartphone to make payments instead of utilizing traditional paper currency. The platform of mobile wallets is not only convenient for users, but it has also created a career opportunity for aspirants.
Perceiving a tremendous development of mobile wallet business model in the last two decades, one can foresee its bright future. If you also yearn to step into the industry of payment gateways and e-wallets, then you must get acquainted with each of its facets. This blog will provide an extensive overview of mobile wallets.
A Brief about Mobile Wallet
Mobile wallet is a system that enables an individual or business to pay and receive money through mobile devices. Mobile or E-wallet is the most secure source of making payments as it runs on encrypted software. Such platforms remove the clutter of the customer’s account and store accurate information of his bank balance.
One can perform multiple operations while using a Mobile wallet:
- Transferring money from one person to another
- Recharge data packs, mobile, and DTH
- Pay utility bills
- Keep track of monthly expenditures
- Bookings train, buses, and airline
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Different Types of Mobile Wallet
Demonetization has a significant impact on the popularity of E-wallets. Soon after the high-value currency got banned, the Government of India starts encouraging the masses to use electronic platforms for payment. Thereby, it results in the release of variant mobile wallets. The customers and entrepreneurs can choose amides these mobile wallet business types:
Closed Wallets- A Closed wallet is a robust tool to amplify client base. It provides cash-back rewards along with facilitating credit money against the rejected orders. Several E-commerce companies, like Flipkart and Snapdeal, exclusively offer closed wallet services to their customers. It enforces the customers to utilize the funds for purchasing goods and services from the issuer.
Semi-Closed Wallet– Similar to Closed wallet, the Semi-Closed wallets do not allow customers to withdraw or redeem cash. However, it enables the users to buy goods and services from the listed merchants under Wallet Company to obtain payment. Some reputed companies like Citrus and Paytm leverages Semi-Closed wallet.
Open Wallet- The Open wallet allows customers to purchase goods and services from any merchant. Moreover, it permits the transfer of funds and cash withdrawal at banks or ATMs. Such type OF Mobile Wallet Business can be only set up with the collaboration of banks. The most popular example of Open-wallets is PayZapp and M-Pesa.
Reasons to Start a E-Wallet Business
Before commencing a business, an Entrepreneur must know the perks of opting that business model. Likewise, you must perceive the advantages of Mobile wallet business. Here are the top reasons to choose the industry of E-wallets:
Easy to Access- Monitory transactions is a core of any industry be it e-commerce, education, health or any other sector. One cannot deprecate the value of cash in our daily operations. While considering the unsound conditions of present scenario, it’s better to keep some money in mobile than in the pocket. Further, Mobile wallets are much convenient and easy to use. It merely requires a user to download the app and create a user ID then; you are good to go.
Automatically Segregate Bills- Isn’t it a bliss to split monthly expenses with your family and friends. As one get overburden under the hefty charges of electricity bills, the Mobile wallet provides an option to split the bills. The users can simply enter the amount payable and the number of people who want to contribute their share. Thus, the E-wallet automatically generates a link to the users to forward it to the people who owe you some money.
Time-Effective- One can skip making necessary payments in the hustle and bustle of work. Therefore, the Mobile wallet business offers a perfect solution to fix the problem of delays in payment. Now you don’t have to bear the penalty on late payments as you can access to auto-pay services of the E-wallet to make payments in advance.
Streamline Fund Transfer- Mobile wallet has made the transfer of funds easy and swift. Furthermore, a platform of the electronic wallet does not levy any transaction charges for transferring money. So one can make at any time and anywhere.
Things to keep in mind before building a Digital Wallet App
You must consider a few important factors before establishing a Mobile-wallet application, such as:
Carefully Integrate Function– Building a Mobile-wallet application is a multi-staged process that requires diligent actions to place functions. One needs to be alert while integrating the features of the digital payment application, otherwise suffer heavy loss. To make your business venture a success, do comprehensive market research and learn about customer’s preferences. Follow the latest trend and create a masterpiece.
Tighten the Security- Any digital payment app gets identified as the most secure method of making payments. Therefore, do not breach the standards associated with a Mobile wallet business. Win customer’s trust by enabling them a reliable system wherein; they can store their card information without any hesitation.
Add the Feature of Reward Points- If you wish to sustain a digital payment business for a longer run, then you must emphasize on customer’s expectations. By facilitating an array of added bonus and reward points to the users, you can strengthen your customer base. Hence, it helps you to nurture a strong position in the market.
Provide Digital Receipt- Just like cash, the digital transactions should also provide receipts. A receipt gives confirmation to the users about the failure or success of a transaction. A digital receipt is a must-have feature in an E-wallet application.
Procedure to set up a Mobile Wallet Business
Follow this step by step guide to build a successful Mobile wallet platform:
- First Step- Conduct an extensive market research and create a business plan according. Prior starting any business, it is indispensable for an Entrepreneur to study the tendency of growth in the market. Study the persistent digital applications in the market and examine their sale strategies. Besides, you can even scrutinize the history of the existing E-wallets and incorporate the best things into your business plan.
- Second Step- Hire competent staff that has years of knowledge and experience. Only professionals can seamlessly implement a unique business idea. Employ an efficient resource like product manager, CTO, senior engineers, system administrator, and creative designers to frame a robust mobile wallet application.
- Third Step- The execution of a plan needs a huge amount of investment. Determine an estimated cost required for building the Mobile-wallet app. Also, contemplate on the sources of fundraising in case of insufficient capital.
- Fourth Step- As per the RBI, every Mobile wallet system must obtain a Prepaid Wallet License. For acquiring the license, an applicant has to provide necessary documents and ensure to meet all the requirements prescribed by the law. Sometimes, the Entrepreneurs should also be PCI DSS certified.