What is a digital payment?
To simplify things before we get into the grit of it, a digital payment refers to any ‘non-cash transaction’. A digital payment is when a payment is made through a digital mode. When making a digital payment, not only the payer but the payee too sends and receives money through a digital mode.To simplify things before we get into the grit of it, a digital payment refers to any ‘non-cash transaction’. So this includes credit cards, debit cards and even less conventional forms of digital payments such as, cryptocurrency transactions.
Australians: What’s in your ‘digital wallet’?
Pretty soon, it could be the entire contents of your physical wallet, digitised. From loyalty cards and loyalty and rewards programs to transit tickets, IDs and more. The digital or ‘eWallet’ is on the rise and is changing the way Australians are spending money throughout the country.
As far as global digital payments go, Australia’s rates of adoption are on the rise. According to a report by CapGemini, Australian digital payments grew by 10% in 2017, which is up from 8.9% in 2016. These statistics put the country right behind the U.S., South Korea and Denmark, ranking 4th in digital payments per capita.
Other changes are also coming soon to digital wallets (or eWallets) in Australia, which will likely speed up the adoption rates for digital payments or ‘non-cash transactions’ even more. Changes on the horizon include: increased mobility, digitally connected homes, contactless options, wearables and advances in augmented reality.
Even though cash is still used for lower-value transactions and one-off or informal purchases, the Reserve Bank of Australia’s Consumer Payments Survey reveals that ‘Australian consumers are increasingly using their debit or credit cards instead of paying cash’. Secure and convenient, all of these non-cash transactions are being streamlined into one digital payment hub – the digital wallet.
From E-Commerce to M-Commerce
Physical environments that accept cash still exist across the country. But, say architects at Warren and Mahoney, retailers are ‘reconfiguring physical environments to match what’s happening online’.
Just as retailers are re-imagining physical environments to match what’s happening online, digital payments are doing the same. These re-imagined mobile transactions present the familiarity of physical banking with the ease of mobile-first/mobile-only.
The growing prevalence of digital payments is apparent in apps like eWallet, that re-think the physical wallet – and then go beyond. The ‘digital wallet’ doesn’t only focus on bringing digital equivalents of physical wallets through cash and cards. eWallet also focuses on translating other financial behaviours, incorporating and integrating actions like linked bank accounts, financial contributions and its management through the app, making for a more streamlined approach.
Apparently, digital wallets see themselves as a ‘hub’ for all the consumer’s needs, centrally located, easily accessible, and integrated.
In Australia, the use of ‘m-commerce’ adds to the ‘e-commerce’ world, with banking and the payment of bills online. These services evolved naturally, and organisations are now offering transaction solutions that call on branded digital wallets, such as eWallet.
Numerous factors have caused the staggering 448% increase in the use of m-commerce services from 2010 to 2013. . Research snapshots by The Australian Communications and Media Authority (ACMA) point to:
- the increased availability and use of mobile phone banking apps and shopping applications
- the availability of 3G, 4G and LTE service networks
- the adoption of mobile-first, moving quickly to a mobile-online culture amongst young people
So, What’s Next?
There’s no doubt about it: Digital payments in Australia are on the rise. Even though banks and financial service providers are still proprietary about their platforms – preferring, instead, to offer customers their customised versions of digital wallets