When Amazon opened its grocery store in Seattle, it was the first-ever cash- and checkout-free supermarket in the US. It relies on a sophisticated collection of infrared sensors and cameras to correctly bill customer’s mobile wallets, letting shoppers grab what they need and leave without ever pulling out cash or credit. But with the Just Walk Out patented technology only operating in Seattle’s flagship store, many people living outside of Washington might wonder why they would ever need a mobile wallet.
A mobile wallet is more than just a ticket into a cashless grocery store on the west coast. A mobile wallet provides an opportunity to change the way consumers manage their money in increasingly convenient and quick ways.
First things first: what is a mobile wallet?
On the surface level, a mobile wallet is a digital version of what you typically keep in your back pocket or purse. It’s any IoT device (or smart device that can connect to the Internet) equipped with the right apps. These apps are provided by banks, fintech companies, online lenders, and retailers. Each app does a different job. Some take on the role of your cash or debit and credit cards, allowing you to pay for things with a simple scan of your personal barcode. Others let you cash in on loyalty rewards accounts. Some, like Starbucks’ and Chase Bank’s mobile wallet, lets you do both.
How does it work?
Contrary to how simple it is to use, it relies on complicated technology. These apps rely on NFC (or Near-Field Communication) chips to transfer data between your device and a retailer’s POS. Only those devices equipped with NFC chips can communicate with each other.
NFC chips aren’t solely used by mobile wallets. If you’ve tapped a credit or debit card at the checkout, then you’ve used NFC technology. Any contactless payment tech shares the same wireless data methods.
Why would you need it?
A mobile wallet simplifies your shopping experience. It takes less time to use your mobile wallet than any other method of payment, so it can save you a ton of time at the till. It’s also much more convenient to use. It’s easy to forget your wallet at home, but most people always remember to bring their phones with them. That means you’re always prepared for when you need to purchase something or collect points.
There are many types of digital payment systems available
Amazon Go isn’t the only way to get use out of your mobile wallet. Corporations like Apple, Google, and Samsung have joined in by offering apps that facilitate digital payments in-store and online. There’s also a growing number of apps that bring other financial services to your phone. Take, for example, an app like Mint. More than 20 million people use this money management app to create budgets, track expenses, and receive alerts about their spending habits. There’s also an app from MoneyKey, an online lender that facilitates personal loans. In a bid to simplify the borrowing experience, they’ve created an app that allows their users to apply, review, and secure cash loans. Then there are online investment apps like Robinhood that provide stock trading options at no cost.
As the role of the mobile wallet continues to evolve, so will its presence in the economy. While you may not have an opportunity to use it often now, a mobile wallet will come in handy eventually. Countries like Sweden are already nearing a cash-free future, with many other developed countries following close behind. Many experts believe the US’ cash-free future is closer than you might think, with Amazon Go just the beginning of retailers’phasing out cash. The only way you could participate is with a mobile wallet designed to make digital payments, making it a very important addition to your smartphone.