What is an e-wallet, how it works, and why you need one

what is an e-wallet

E-wallets are a must have for users completing transactions with electronic money. Find out why. 

What is an e-wallet?

An e-wallet can be thought of like an electronic card which grants you the ability to make transactions online through a computer, or via a smartphone. E-wallets have the same functionality as a credit/debit card and must be linked with your bank account to make payments. An e-wallet is a type of password protected, pre-paid account in which you can store your funds for online transactions. E-wallets also allow users to store multiple credit card and bank account numbers in a secure environment. 

How do e-wallets work?

E-wallets have two primary components: software and information. The software component stores your personal information as well as providing security and encryption of data. The information component, in effect, is a database of details provided by the user which includes names, shipping addresses, payment methods, amount to be paid and debit/credit card details. 

To set up an e-wallet, all you need to do is install the software on your device. Once this step has been completed, you must enter the relevant information that is required. When you make a purchase online with an e-wallet, the e-wallet will fill in your details automatically on the payment form. To activate the e-wallet, you’ll need to enter your password. Once the online payment has been completed, you’ll no longer need to fill in an order form on a different website since the information is stored in the database and updated automatically. 

Why should you use an e-wallet?

One benefit of using an e-wallet is that you don’t need to look for your debit/credit card or bank information every time you want to make a purchase. Plus, if you want to make two payments using two separate cards, you can switch between both at your leisure if they are both kept in your e-wallet.  A common feature in e-wallets is the use of QR codes. QR codes allow for the quick completion of transactions since all users have to do with one is scan the code. Not every e-wallet will use QR codes, however, so be sure to do your own research before committing to a decision, if QR codes are a feature you are looking for. 

Are they secure?

Your e-wallet can only be accessed through your account and password logins. Typically, any debit/credit cards or bank account information associated with the e-wallet will also be masked. This ensures no one will ever be able to see the full number/s while logged in to your account. 

E-wallets will also come with their own encryption algorithms to help secure your information. However, you will need to enter a password or other verification details any time you wish to change any account information. Whenever a payment is made using an e-wallet, the retailer/merchant does not receive your card details. In place of the card details, they will receive a random transaction number. This helps protects against fraud. 

Conclusion

In short, e-wallets are easy and secure to use. You should use an e-wallet if you plan on using e-money and making digital transactions. Not only will it offer your strong levels of security, it will also boost overall convenience for carrying out purchases. 

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