So much has changed over the past few years, but among the biggest transformations has been the shift from cash to digital payments. More and more people are ditching cash to use credit cards—and many are skipping the plastic altogether to use digital wallets.
If you’re scratching your head right now wondering “what the heck is a digital wallet?” don’t worry! It’s a pretty new term that’s emerged in recent years. With more and more people going digital though, it’s useful to know everything you can about digital wallets. (And if your company offers Branch, you have access to your very own digital wallet right now!)
Our 3-part series will help you learn the basics of digital wallets. You’ll discover how you might already be using one and not even know it, how they can make your life a little simpler, and how to set yours up in 3 easy steps.
What is a digital wallet?
A digital wallet is a virtual checking account that allows you to spend money right from your phone. No physical wallet, credit card, or paper money is required; as long as you have your mobile phone, you’re good to go. You can link physical cards to your digital wallet, however. In this case, you’d be able to pay for something from one account in two different ways—with either your phone or the associated physical card.
How does a digital wallet work?
You can use a digital wallet just like you’d use the contents of a physical wallet. Here are a few examples of things you can do with your digital wallet:
Make purchases
On the go? As long as you have your mobile phone, you can pay for breakfast, that tank of gas, a run to the drugstore, or whatever else you need.
Pay bills
Pay bills with your digital wallet just like you would a debit or credit card. Whether it’s your rent payment or monthly utility bill, your digital wallet has you covered.
Send and receive money
Need to pay your friend back for dinner? Use your digital wallet to quickly send peer-to-peer payments.
Track your spending
Some digital wallets can also give you an at-a-glance view of your spending habits. This feature helps you manage your money and plan for the future.
Are digital wallets secure?
When it comes to security, digital wallets have cash and cards beat. If you’re walking around with cash loose in your wallet, the potential for theft is much higher than if you make payments with a digital wallet. Think about it: if your digital wallet is stored on your phone, there are multiple security measures and passcodes in place between the thief and your information. Cash or credit cards, on the other hand, can be stolen and then used immediately.
Branch recommends the following security measures to maximize the safety of using a digital wallet:
- Your phone passcode. Make sure your phone passcode is enabled so someone can't access your information if they take your phone.
- Digital wallet passcode. If you use a digital wallet through Branch, we require you to have a 6-digit passcode for your protection.
- Lock/unlock card feature. You can also lock/unlock your digital wallet and any associated cards at any time when using Branch.
These features help keep you and your information secure so your digital wallet can remain the safest place to manage your money.
What should I look for in a digital wallet?
The right digital wallet should be fast, free, and easy to use.
Fast
One of the ultimate advantages of going digital is speed. Instead of cashing a check and waiting for it to hit your account, digital wallets allow for instant payments and transfers.
Free
Your digital wallet shouldn’t come with overdraft fees or minimum balance requirements; it should be free to use.
Easy to use
Though there will always be a slight learning curve when adapting to new technologies, the right digital wallet should be straightforward and offer support in helping you understand its features.
Discover even more about digital wallets
Now you know the basics of digital wallets. But there's still a lot more to discover. For example, you may have already used a digital wallet and didn't even know it. Find out in the next post.
Ready to get started?
Using Branch, you have access to all of the digital wallet features above—and we pride ourselves on being fast, free, and easy to use. When you switch to a digital wallet you can say goodbye to paper checks, cash, and credit cards, and make secure and convenient transactions whenever you like from your phone. Leave the clunky wallet at home—go digital today.
