How to use a digital wallet effectively

No need for bulky wallets and no fear of losing cash or cards, thanks to the digital wallet revolution. Here are quick tips on using these digital wallets effectively, so that next time, you feel like going for a movie, all you might need to do is tap your phone and pay via digital wallet app.​​​​​​​

1) Four kinds of mobile wallets-

A) Open Wallets allow almost all kind of transactions like

-Cash withdrawal,

-money transfer and

-Paying for purchase of goods and services.

• They are bank-backed.

• Example-M-Pesa, a joint venture between Vodafone and ICICI,

• Idea Money (along with Axis Bank)

B) Semi-closed/Independent wallets may not allow cash withdrawal or reimbursements.

-Can be used at select merchant sites.

-Amount of money loaded on these cards, will have to be spent towards listed purchases.

Examples- Paytm, Mobikwik, Oxigen .

C) Closed wallet is an exclusive or a prepaid wallet which can be used at a particular outlet of the service provider.

Example, Myntra and Flipkart and some telecom providers offer closed wallets with services like fund transfer, recharges and cashbacks.

2) Fill up Know Your Customer Norms

-Without KYC, fund transfer limited to Rs.10,000 for non-verified customers.

-With KYC, limit up to Rs.1 lakh

3) Track Discounts and cashbacks

-Due to stiff competition, many of them offer deep discounts and cashback offers when you make payments through these mobile wallets,

-Applies to volume driven transactions like booking movie tickets or prepaid recharges

-Track these offers on third party apps such as CouponDuniya

4) Risk- loss of the mobile wallet or the smartphone.

Solutions

• Phone-screen lock is a must.

• Have different passwords for multiple digital wallets.

• Use Mobile security apps